ABSTRACT
We examine dominant ownership in Continental European firms to further refine the distinction between the ability to control and actual control and whether a particular distinct shareholder ownership type is associated with company performance. In addition, we empirically test whether the economic performance of the firms from different countries is consistently affected by the nature of the company's dominant owner. After disaggregating the overall sample by specific ownership type and by country, we find a positive relationship between dominant ownership and performance for firms in which banks and families/individuals are the dominant owners and a negative relationship when corporations are the dominant owners. Additional analysis discloses an even more complicated picture, suggesting that countries are not homogenous in terms of their ownership landscapes and, hence, their effects on performance.
