A Dynamic Relationship Between Ownership-Structure And Firm Financial Performance: Evidence From Emerging Economy

Abstract

The primary purpose of the study is to examine the connection between ownership concentration and firm/business performance. Over a six-year period, the study examined 250+ nonfinancial companies listed on the KSE (Karachi Stock Exchange) from 2015 to 2020. The “percentage of shares held by the largest shareholder, the five largest shareholders, and the ten largest shareholders” was used to calculate the ownership concentration, and Tobin's Q and accounting base performance parameters were used to assess the firm's performance (ROA and ROE). To examine the association, multiple regression models were used. The findings showed that ownership concentration had a favorable impact on performance of the listed firms using a dynamic framework while recognizing the complexities of the relationship