Work

Do Shareholders or Stakeholders Appropriate the Rents from Corporate Diversification? The Influence of Ownership Structure

Year: 2010

Type: article

Abstract: Prior work on the performance consequences of corporate diversification has treated all powerful owners as seeking the same benefits from diversification (i.e, higher profit rather than growth) and therefore limiting value appropriation by other stakeholders such as employees and managers. In contrast, we distinguish between domestic “relational” owners and foreign “transactional” owners in Japanese corporations. Although transactional owners do indeed prioritize profitability when diversifying, relational owners primarily seek growth rather than profits from diversification. Furthermore, relational owners also allow managers and employees to appropriate more of the rents arising from diversification than do transactional owners.

Source: Academy of Management Journal

DOI: 10.5465/amj.2010.51469005

Authors: Parthiban David, Jonathan P. O'Brien, Toru Yoshikawa, Andrew Delios

Institutions: Rensselaer Polytechnic Institute, National University of Singapore, American University, McMaster University

Language: English

Topic: Corporate Finance and Governance

Subfield: Accounting

Field: Business, Management and Accounting

Domain: Social Sciences

Open Access status: green

OpenAlex ID: W2166285176

FWCI: 40.3

Cites: 110

Cited by: 201

Related to: 10