Silvia Gómez-Ansón

Family Ownership and Control, the Presence of Other Large Shareholders, and Firm Performance: Further Evidence:

This article analyzes, using various econometric techniques, how family ownership, family control, and the presence of a second significant shareholder affect firm performance. The authors studied a panel of 118 nonfinancial Spanish companies (711 observations) from 2002 to 2008. Once endogeneity issues were considered, it was found that family ownership did not influence profitability. What seems to matter is family control. This study also reveals the importance of taking into account unobservable heterogeneity and endogeneity issues when analyzing firm performance and provides an interesting future avenue of research: the role played by other large shareholders in family firms.

Family Ownership and Pyramids in the Spanish Market

This aim of this article is to describe, in the Spanish setting, family ownership and to explore how families hold their shares (the use of indirect ownership, pyramids, and cross-shareholdings). It also seeks to describe to what extent cash-flow rights differ from control rights and the degree of the firms professionalization according to every type of owner category, but especially for families.

The Company You Keep: The Effect of Other Large Shareholders in Family Firms

Manuscript Type. Empirical. Research Question/Issue. Using a panel of non‐financial listed firms over a seven‐year period, the authors analyse how the value of family firms is potentially affected by the existence of multiple shareholders, by other large shareholders’ voting rights in relation to the familys, by the final power distribution (that is, whether the familys voting rights exceed those of other shareholders), by the identity of the blockholders, and the existence of shareholder agreements. Research Findings/Insights. After controlling for possible self‐selection bias and for endogeneity issues, the results of a Heckman two‐stage method suggest that other large shareholders’ voting rights in relation to the familys do not affect family firm value. The results indicate that what seems to matter is who controls the company in terms of voting power, i.e., whether there is just one large shareholder or other major blockholders as well, and whether they have more or fewer voting rights than the largest owner. The market favors a firm that has multiple large shareholders provided that the family retains control by holding most of the voting rights. However, when there is just one family owner or when other blockholders have more voting power than the family, industry‐adjusted family firm value is negatively affected. The existence of shareholder agreements and families and non‐financial firms as other blockholders has no impact on company performance, while foreign shareholders tend to increase family firm value. Theoretical/Academic Implications. Academics should take the presence of multiple large shareholders into account as this can affect family power. It is not a question of collusion or contestability per se. The market seems to value other large investors’ ability to balance family power only if families retain control by holding the majority of the votes. The preferred model therefore resembles that of a king amid nobility, a “primus inter pares”, with other large blockholders (nobility) providing a credible and strong but not overwhelming opposition that benefits minority owners. Practitioner/Policy Implications. When multiple large owners exist, firm value is increased if the family retains power. Ownership structure matters and the effect of other large shareholders’ voting rights on minority investors’ wealth has to be considered. New variables to describe particular situations in family firms are needed.

Recent corporate governance developments in Spain

This major Handbook provides a comprehensive analysis of the development of corporate governance across a range of countries including Australia, Germany, India, Italy, Japan, Poland, Russia, South Africa, Spain, Turkey and the UK. Whilst the stage in the corporate governance life cycle may vary from country to country, there are certain core features which emerge such as the importance of transparency, disclosure, accountability of directors and protection of minority shareholders’ rights.