What do we know about corporate value and ownership structure?

Abstract

This paper reviews the literature on ownership structure and corporate value. Our analysis suggests that the distribution of ownership among different groups of shareholders insiders, large blockholders and institutions is important in determining firm value and the occurrence and outcome of control contests. At low levels of inside ownership, the relation between firm value and the fraction of shares owned by corporate insiders is positive. However, there is no consensus on the role of large blockholders and institutional investors in corporate governance. We suggest some topics for future research in this area.