International diversification: the impact of ownership structure, the market for corporate control and board independence

Majocchi, Antonio and Strange, Roger (2012) International diversification: the impact of ownership structure, the market for corporate control and board independence. Management International Review, 52 (6). pp. 879-900. ISSN 0938-8249

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Abstract

International Diversification can have both benefits and costs. In this paper, we argue that a firm's level of International Diversification depends not only upon firm-specific characteristics such as its size and the industry to which it belongs, but also upon its ownership structure and the ability of its management to carry out an international strategy. We test our hypotheses using a panel of Italian firms. Our findings show that a high level of family ownership has a negative effect on International Diversification, but that an inactive market for corporate control negates this. We found too that when the board of a family-owned firm has a higher proportion of independent directors, International Diversification is greater. We also found that similar to the family-ownership effect, a high level of state ownership results in less International Diversification. Overall our results confirm that corporate governance variables affect International Diversification.

Item Type: Article
Schools and Departments: School of Business, Management and Economics > Business and Management
Subjects: H Social Sciences
Related URLs:
Depositing User: Janet Snow
Date Deposited: 28 Feb 2013 09:44
Last Modified: 28 Feb 2013 09:44
URI: http://sro.sussex.ac.uk/id/eprint/40115
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