Firm ownership and internationalisation: is it context that really matters? (original) (raw)
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Corporate Ownership and Control, 2013
While the role of corporate governance has been increasingly analysed during recent years, it is only very recently that the effects of corporate governance features on firm international strategies have been also considered. Using the Osiris database by Bureau van Djik we consider the potential role played by different kind of shareholders among the determinants of firm international level, distinguishing between the firms quoted in the UK from those listed in countries of Continental Europe (France, Germany, Italy, Poland and Spain). Overall our results confirm that different kind of ownerships affect with different degree of intensity the overall level of firm’sinternationalization. First, we find that ownership matter. Second, our results show that theeffects of ownership over firm’s international strategies depend also on the context of analysis.
The role of firm ownership on internationalization: evidence from two transition economies
Journal of Management and …, 2011
This paper investigates how different types of owners influence the extent of firm internationalization, measured by the share of firm exports in total sales. The results of the analysis carried out using firm level data of Estonian and Slovenian firms, show that the firms under the control of the insider owners are, on average, more internationalized. State control, on the other hand, hampers internationalization efforts. Further, more productive firms, larger firms, more capitalintensive firms and those with high level of investment in both fixed capital and R&D are more successful in internationalization process. Finally, high market share also leads to increased internationalization through exports as firms seek to expand in foreign markets after having dominated the domestic ones.
Internationalization of family firms: the effect of ownership and governance
Review of Managerial Science, 2012
Despite family firm's dominant role in economies worldwide, there is little empirical knowledge on their internationalization. Drawing on a sample of Austrian firms, this paper investigates the impact of family influence and various governance factors on internationalization. The findings reveal an inverted U-shaped relationship between family influence and internationalization. Family firms with medium family influence are the most internationally active companies. This indicates that concerning internationalization the advantages of being a family firm are highest when the family's ownership share and involvement in management and governance boards is not too extensive. Additionally, neither the incumbent generation, nor the level of non-family executives in the management board, nor the C. Mitter existence of a supervisory board has a significant influence on going international. Since advisory boards seem to foster internationalization, they might be an adjuvant means of equipping family firms with the necessary capabilities, know-how and contacts to operate internationally.
Entrepreneurial Business and Economics Review
The article focuses on the role of ownership in the process of entrepreneurial internationalisation of the firm. The main objective of the article is to verify whether and how ownership impacts on the level of internationalisation. Research Design & Methods: The study elaborates on three dimensions of ownership, which are ownership structure (foreign vs. domestic), family ownership and the characteristics of the owner (age, sex, global mindset and knowledge-the last two measured on a 5-point Likert scale). The sample of 190 internationalised Polish businesses were used in order to verify the assumed hypotheses. Findings: The investigated firms operating in Poland of foreign ownership are more internationalised, measured by TNI, than those of domestic capital only. As a general rule, the investigated non-family firms are more internationalised than family firms as for the average TNI value. International attitude of the entrepreneur-owner affect the level of internationalisation: the higher values of attitude index, the higher values of TNI. Neither the age nor the sex of the entrepreneur affect the level of internationalisation. Implications & Recommendations: it is obvious that knowledge is one of the key factors affecting the internationalisation, especially market choices, entry modes as well as the speed of internationalisation. Although much has been done in this field, but it still needs further and deeper investigations. Contribution & Value Added: The current study and its findings indicate that ownership is one of key aspects relevant for explaining the internationalisation of firms, but its impact on firms' international behaviour is somewhat equivocal. Article type: research paper
Ownership and the Internationalization of Small Firms
Journal of Management, 2005
Keywords: ownership; international entrepreneurship; family business; agency theory † The comments of Daniel Feldman and three anonymous reviewers of the Journal of Management helped improve this article significantly. We appreciate the helpful comments of Mason Carpenter
Effects of internationalization on ownership structure: evidence from latin american firms.
BAR. Brazilian Administration Review, 2014
We analyze the direct and simultaneous effects of internationalization on the ownership structure of Latin American companies based on agency theory. Using a sample of 425 Latin American firms between 2007 and 2011, which corresponds to 1,776 observations, we use random effects and three-stage least squares panel data regression to test these effects. We find that the hypothesized positive effect of internationalization on ownership concentration is rejected. Our results support the negative relationship that is predicted by principal-agent theory when analyzing the effect of ownership on the degree of internationalization. Greater internationalization via the equity entry mode is associated with lower levels of ownership concentration. Finally, there is simultaneity in the determination of the relationship between the degree of internationalization and ownership concentration.
Corporate Ownership and International Mergers and Acquisitions
This paper employs a novel dataset of international mergers and acquisitions (M&As) for which we observe ownership structure of a target firm including the identity and country of origin of its controlling shareholder. We examine whether and how different types of controlling shareholders in target firms— individual(s)/family, industrial, financial, and government—as well as their domicile—domestic versus foreign—are associated with the incidence of cross-border M&As. We find that individual(s)/family and government owners are negatively associated with the incidence of cross-border M&As; while the opposite holds for foreign owners. After refining the categorization of domestic versus cross-border deals, we show that while foreign government owners are more likely to pursue " pseudo " domestic deals, foreign industrial and financial owners are more likely to engage in " genuine " international deals. We then explore economic mechanisms behind the observed associations by interacting target firm ownership structure characteristics with firm-and country-level factors such as size and age, and geographic, sociological, and cultural proximity measures. We conclude that the significant associations between corporate ownership and the incidence of cross-border deals are likely driven by both target firm fundamentals and its controlling shareholder's preferences.
Journal of Management & Governance, 2010
This paper examines the effect of country-specific institutional constructs on the relationship between ownership concentration and performance for firms in the eight Continental European countries of Austria, Belgium, Germany, Spain, France, Italy, the Netherlands and Portugal. Using data from publicly-traded firms owned by other companies (i.e., blocks), measures of the quality of investor and creditor protection and the effectiveness of legal institutions are applied. Employing a hierarchical moderated multiple regression analysis, differential validity is established for the relationship between ownership concentration and performance as measured by return on shareholders’ funds. This differential effect comes from creditor protection regimes and is consistent with a relational corporate governance model based on debt finance and concentrated ownership.
Entrepreneurship Theory and Practice, 2012
ABSTRACT This research focuses on family‐controlled firms as an important type of family firms, and demonstrates how external parties in the governance (ownership and board of directors) can serve as a catalyst for their internationalization. Our framework also embraces the moderating effects of the competitive environmental heterogeneity and past performance on the relationship between external, nonfamily involvement in governance, and internationalization (scale and scope). The hypotheses are tested on a sample of 351 Swedish family‐controlled firms. Our findings extend previous research on family firms and their internationalization, especially addressing some of the prior mixed findings, and offers implications for both theory and practice.
The Role of Family Firms Heterogeneity on the Internationalisation and Performance Relationship
European Journal of Family Business, 2021
Many papers have addressed the influence of different characteristics of family businesses on strategic decisions, including those of internationalisation. However, little is known about the relationship between the internationalization of family firms and firm profitability. For this reason, from the socioemotional wealth perspective, in this paper, we focus on the moderating role of some heterogeneous characteristics of family firms on the relationship between internationalisation and business performance. Specifically, we analyse a sample of 76 companies belonging to the Spanish hotel industry, one of the most internationalised sectors and with a large presence of family businesses. The results show that family involvement in ownership and management, as well as generation, moderates the relationship between internationalisation and profitability in the Spanish hotel industry.