Article ID | Journal | Published Year | Pages | File Type |
---|---|---|---|---|
7413669 | Research in International Business and Finance | 2018 | 8 Pages |
Abstract
Although agency theory implies that greater parent ownership can help mitigate agency conflict, principal-principal conflicts could arise among controlling and other minority shareholders. This study investigates corporate governance in publicly listed subsidiary firms after the establishment of small-cap markets, which is a unique setting in Japan. The results show that parent control has a negative relationship to dividend payout and firm profitability. However, parent control enhances sales growth, which is not consistent with parent control exploitation. Foreign shareholders moderate the conflict between parent firms and other shareholders related to dividends and firm profitability.
Related Topics
Social Sciences and Humanities
Business, Management and Accounting
Business and International Management
Authors
Hideaki Sakawa, Naoki Watanabel,