Ownership Structure and Firm Financial Performance

Evidence From Panel Data in Sri Lanka

Authors

  • Nirosha Hewa Wellalage
  • Stuart Locke

DOI:

https://doi.org/10.15209/jbsge.v7i1.214

Abstract

This study investigates the effects of equity ownership structure on financial performance of Sri Lankan listed businesses. Using dynamic panel generalised method of moment this study finds an inverse hump shape relationship between insider ownership and firm financial performance. The results of this study confirm that the effect of insider ownership on firm performance is more positive and significant where legal protection for investors is weak. It suggests that although new legislative reforms have been enacted, Sri Lankan companies are highly dependent on internal governance mechanisms. There is potential merit in promulgating new rules to control the expropriation of minority shareholders.

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Published

2012-08-01

How to Cite

Wellalage , N. H., & Locke , S. (2012). Ownership Structure and Firm Financial Performance: Evidence From Panel Data in Sri Lanka. Journal of Law and Governance, 7(1), 51–64. https://doi.org/10.15209/jbsge.v7i1.214

Issue

Vol. 7 No. 1 (2012)

Section

Articles

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