Foundation Ownership, Reputation, and Labour

Oxford Review of Economic Policy, Forthcoming

32 Pages Posted: 22 Apr 2017 Last revised: 7 Nov 2020

See all articles by Christa Børsting

Christa Børsting

Copenhagen Business School - Department of International Economics and Management, Students

Steen Thomsen

Copenhagen Business School; European Corporate Governance Institute (ECGI)

Date Written: November 12, 2018


A number of firms in Northern Europe and especially in Denmark are owned by private foundations similarly to what would have been the case if the Ford Foundation had owned a majority of the shares in Ford Motor Company. Foundation-owned companies appear to perform surprisingly well in terms of profitability and growth despite lacking governance mechanisms like profit incentives or takeover threats. Given their non-profit ownership, they might be expected to behave more responsibly towards stakeholders such as employees or customers (Hansmann 1980), but so far there has been little empirical evidence to support this hypothesis. This paper presents new research on the reputation and responsibility of foundation-owned companies. In a panel of large Danish companies 2001-2011 we find that foundation-owned firms have better reputations and are regarded as more socially responsible in corporate image ratings. Secondary evidence on labour market behaviour is consistent with these findings. Using matched employer-employee data we show that foundation-owned companies are more stable employers, pay their employees better and keep them for longer. Altogether, the evidence indicates that foundation-ownership is associated with more responsible business behaviour towards employees.

Keywords: Foundation Ownership, Reputation, Labour, Corporate Governance

JEL Classification: G34, L21, L31, J54

Suggested Citation

Børsting, Christa and Thomsen, Steen, Foundation Ownership, Reputation, and Labour (November 12, 2018). Oxford Review of Economic Policy, Forthcoming, Available at SSRN:

Christa Børsting (Contact Author)

Copenhagen Business School - Department of International Economics and Management, Students ( email )


Steen Thomsen

Copenhagen Business School ( email )

Porcelaenshaven 24A
Copenhagen, 2000
+45 38152590 (Phone)
+45 38152500 (Fax)

European Corporate Governance Institute (ECGI) ( email )

c/o the Royal Academies of Belgium
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1000 Brussels

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