• Medientyp: E-Artikel
  • Titel: Are all forms of ownership prone to tunneling? A meta‐analysis
  • Beteiligte: Solarino, Angelo M.; Boyd, Brian K.
  • Erschienen: Wiley, 2020
  • Erschienen in: Corporate Governance: An International Review, 28 (2020) 6, Seite 488-501
  • Sprache: Englisch
  • DOI: 10.1111/corg.12344
  • ISSN: 0964-8410; 1467-8683
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  • Beschreibung: AbstractResearch Question/IssueThis study seeks to extend agency theory in the context of tunneling by exploring how different owner types seek private benefits of control. Specifically, we examine how information asymmetries and board representation create different pressures for tunneling for state‐owned, business group‐owned, and family‐owned firms. We tested our hypotheses with a meta‐analytic structural equation model.Research Findings/InsightsOur findings show that the relationship between ownership and tunneling differs across owner types in terms of both directionality and magnitude. Our study offers a substantial theoretical contribution to the principal–principal problem literature by theorizing and testing variations of the problem among owners. Our study also advances our understanding of the role of ownership in firms.Theoretical/Academic ImplicationsOur findings have important theory‐building implications for the principal–principal literature. Controlling shareholders have been linked to performance outcomes or to tunneling in general, yet little is known about their comparative propensity to engage in tunneling. Our results, however, highlight that the propensity to engage in tunneling varies substantially among controlling shareholders. Furthermore, in the robustness checks, we disconfirm some of the assumptions of the principal–principal literature. This study demonstrates the need to theorize about specific types of ownership and reassess the core arguments of principal–principal theory.Practitioner/Policy ImplicationsThis study offers insights for policymakers interested in mitigating the risk of minority shareholders being expropriated by the controlling shareholder. As the key driver of tunneling appears to be access to private information and knowledge of the firm, we offer recommendations on what policymakers can do to minimize the asymmetry of information.