Ownership concentration, corporate governance and firm performance: Evidence from Pakistan

PurposePakistan has experienced financial liberalization with rapid ups and downs in economic growth due to domestic issues during the last 2 decades. Motivated by inconclusive and conflicting time-driven findings about the performance of the business groups, this study examines the performance of business groups in Pakistan for a relatively long period from 2003 to 2018.Design/methodology/approachThe study uses 3,821 firm-year observations from non-financial firms listed on the Pakistan Stock Exchange (PSX). For the estimation, pooled ordinary least squares (OLS) with industry- and year fixed effects and two-step system generalized methods of moments (GMM) are used.FindingsThe study finds that group-affiliated firms outperform independent firms in accounting performance, while underperform in market performance. The outperformance is mainly driven by medium-sized business groups, while underperformance is driven by small and large business groups. Further, the study documents that the underperformance in terms of market performance of firms affiliated with small and large groups is greater before the economic downturn, while outperformance in terms of the accounting measure of firms affiliated with medium-sized groups is greater during the economic downturn. These findings support our time-driven concerns. Overall, the authors' findings are consistent with institutional and transaction cost theories.Practical implicationsBusiness groups are important channels to reduce market inefficiencies. Business groups may enhance the affiliated firms' resources and resistance capacity through active utilization of the internal capital market, specifically when market conditions are not ideal for affiliates. However, effective utilization of internal capital markets depends on group size. Therefore, investors should deliberate on the size of business groups and diversification within business groups.Originality/valueThe authors extend the literature by providing fresh evidence related to the performance of business groups in the Pakistani context while accounting for the role of the size of business groups.

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The performance of business groups during institutional transition and economic downturn in a developing country

Bhutta

Sultan

Sheikh

et al. 2023

IJOEM

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Corporate governance looking back to look forward in Pakistan: a review, synthesis and future research agenda

et al. 2022

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The basic aim of this paper is to systematically review the corporate governance research trends in Pakistan and to give directions for future researchers in this field. The methodology adopted in this paper is “Systematic Literature Review,” 108 papers have been used from the period 2002–2020 along with 17 research theses in this study. The findings of this study show two trends in corporate governance research first one form 2008 to 2016 and the second one is from 2017 to 2020. The first trend shows that corporate governance (variables) is linked with traditional topics such as firm performance, dividend policy, capital structure, cost of capital and earnings management. The theory which is mostly used in the first corporate governance trend is the agency theory. In the second trend, corporate governance (variables) are linked with multiple issues while taking various theoretical perspectives such as risk taking, tunneling, CSR, investment portfolios, board-related issues, financial distress and much more. This paper has identified and filled the research gap by writing a comprehensive review paper of the prevailing corporate governance literature and has given directions for future researchers to consider it. To the best of researchers’ knowledge, this is the first study that has systematically reviewed and synthesized the corporate governance literature by adopting the systematic literature review methodology in Pakistan an emerging economy. It is an extensive effort for the purpose to encourage the interested researchers/scholars to add and expand their contributions to the corporate governance literature in Pakistan on the potentially identified areas of corporate governance.

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Corporate governance and the environment in the health sector: Systematic literature review

Marques

Serrasqueiro

Nogueira

2020

JGR

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This study aims to explore the different forms of corporate governance in the health sector, how they interact, and analyze the emerging research trend through a systematic literature review (SLR) in the period 2015-2019. The Scopus and ISI Web of Science databases were used to select the 167 articles analyzed. The coverage of corporate governance research was centred on adapting the PRISMA analysis, highlighting the environment which corporate governance belongs to and analysis of the co-occurrence of the keywords used in the studies. Through Grounded theory, a conceptual model was developed, emphasizing the main attributes that influence governance at the macro-, meso- and micro-levels, in the health area, and raising a future agenda for future research in this area: (1) quality of health care, (2) corporate social responsibility in health, (3) health risk management and (4) global health governance. The results of this research aim to guide governments towards emerging regulatory trends, warning about the risks of the impact of corporate governance on health, or the lack of it, on the quality of services. Analysis of the quality of health care is intrinsically related to the environment, although this aspect has received little attention from researchers.

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Ownership concentration, corporate governance and firm performance: Evidence from Pakistan

Cited by 3 publications

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The performance of business groups during institutional transition and economic downturn in a developing country

The performance of business groups during institutional transition and economic downturn in a developing country

Corporate governance looking back to look forward in Pakistan: a review, synthesis and future research agenda

Corporate governance and the environment in the health sector: Systematic literature review

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