Management

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Corporate governance, ownership structure and firm performance

The characteristics of corporate governance, and in particular the legal protection of minority investors and the ownership structure, can affect the corporate valuation and firm performance. This agency problem which affects Italian and European corporations may induce the expropriation of minority shareholders by the controlling owner, particularly if legal protection is poor.
On the other hand, concentrated ownership and family control may have a positive effect on market valuation and operating performance, as increasing a controlling owner's cash-flow rights improves the alignment of interests between the controlling owner and the minority shareholders and reduces the effects of entrenchment.
The papers listed below examine the characteristics of corporate governance of Italian and European firms, and identify their effect on the value and performance of firms.