Institutional framework, concentration of ownership and results of large family corporations in Latin America and Spain
Abstract
Purpose
This paper aims to clarify the relationship between institutional framework, concentration of ownership in family firms and results.
Design/methodology/approach
Data comprises two samples of family firms from eight Latin American countries and Spain in the year 2010. The first sample contains the largest 20 corporations from each country. The second comprises the 20 largest listed family corporations in each country. To test the hypothesis, the study uses ordinary least squares.
Findings
First, firms located in countries with a higher than average quality of the institutional and regulatory frameworks are less concentrated in ownership than firms located in countries with lower than average quality and development of institutional and regulatory framework. Second, the influence of the concentration of the ownership in the performance is more important in countries with higher developed institutional and regulatory frameworks. Finally, first-generation large family firms obtain higher results than large family firms in second generation or beyond.
Research limitations/implications
The study is limited to one year and there are few family firms in Latin American countries. The study only considers some features of ownership, and there is no information about board of directors ' composition.
Practical implications
Institutional framework determines concentration of ownership in family firms and the influence of concentration of ownership in performance.
Originality/value
The study provides new evidence in areas of corporate governance and family firms, analysing a sample of Latin American and Spanish firms, representatives of the civil legal system and a weaker institutional framework. The study uses the corruption perception index like a control variable.
Keywords
Acknowledgements
The authors thank Mrs Paloma Fernández from the Department of History and Economics Institutions and from the Studies Centre Antoni de Capmany of the University of Barcelona for very helpful advice and for facilitating access to some of the data. They are grateful to participants in the seminar “Network of Interdisciplinary Research in Family Firms” at the University of Barcelona (September 2011), organised by Paloma Fernández and Andrea LLuch. More specifically, they are grateful to Armando Dalla, Carlos E. Drumond, Mario Cerutti, Carlos Dávila, Juan C. Leiva, Erick Guillén, Jon I. Martínez, Martín A. Monsalve, María I. Barbero, Lourdes Casanova and Allan Discua for very useful suggestions. Finally, they are grateful to the editor and anonymous referee. The authors take full responsibility for any remaining errors.
Citation
Galve-Górriz, C. and Hernández-Trasobares, A. (2015), "Institutional framework, concentration of ownership and results of large family corporations in Latin America and Spain", Corporate Governance, Vol. 15 No. 4, pp. 409-426. https://doi.org/10.1108/CG-12-2014-0144
Publisher
:Emerald Group Publishing Limited
Copyright © 2015, Emerald Group Publishing Limited