Strategic Management (Jan 2019)
Ownership structure as a measure of corporate performance
Abstract
Economic transition is not a one-dimensional process but implies ownership, structural and management transformation. We can call the current circumstances of the economy of the Republic of Serbia posttransitional, for which the ownership transformation is largely due. The aforementioned process is the basis for the formation of a corporate sector in which all the most important determinants of professional management are expressed, since the capital market represents the greatest distance between ownership and management. The structure of corporate ownership determines the nature of the relationship between managers and shareholders, which in the final instance manifests in the form of principal - principal or principal - agent of the situation. The paper will analyse the nature of the ownership structure of corporations, according to one of the usual three dimensions (concentration of ownership), in relation to the corporate performance. The corporate performance will be expressed using the Tobin's Q indicators. The structure of ownership of the corporation will be presented using two sets of indicators. The first group consists of indicators of percentage participation of a number of major shareholders in the form of Top_1, Top_2, Top_3 and Top_5. Another approach to property ownership analysis includes G1 (widely held) indicators that represent dispersed -owned corporations, G2 corporations with large shareholders, and G3 (ultimate owner) majority-owned corporations. In the random sample will be selected corporations that have a listing on the Belgrade Stock Exchange, while at the level of parametric statistical procedures, methods will be used for analysingthe correlation between the listed variables and identifying the differences between the groups formed on the basis of the above mentioned criterion. The main objective of the paper is to define the ownership structure of a corporation that has direct implications for the management and performance of corporations. Corporate performance expressed through market capitalization determines the future of operations through the scope of future investments.
