Ownership Structure, Insiders Ownership and Firm Performance in Spanish Non-Listed Firms

Abstract

This study provides new evidence on the way in which ownership concentration and insider ownership influence non-listed firms performance, differentiating the behaviour of family and non-family firms using data on 586 non-listed Spanish firms. The empirical evidence shows that for family firms the relationship between ownership concentration and firm performance differs depending on which generation manages the firms. Confirmation is found of the monitoring effect and also the expropriation effect for the very highest ownership concentration in non-listed Spanish family firms. Concerning insider ownership, our evidence supports both the convergence of interest and the entrenchment effects, and suggests that Spanish family firms’ insiders become entrenched at higher ownership levels.

Keywords: ownership concentration, insider ownership, non-listed firms, family firms

JEL Classification: G32