IMPACT OF OWNERSHIP STRUCTURE ON THE PERFORMANCE OF NIGERIAN CONGLOMERATES FIRMS
Date
Authors
Journal Title
Journal ISSN
Volume Title
Publisher
Abstract
This study examine the Impact of ownership structure on the performance of Nigerian conglomerates firms. The major objective of the study is to ascertain the level to which ownership structures influences the performance of Nigerian conglomerates firms. The population of the study is all 8 conglomerates firms listed on the Nigerian Stock Exchange as at 31st December, 2013. The use of secondary data has been adjudged a better source as it makes available all needed for the empirical investigation in this type of research. Data was extracted from the Published Audited Annual Reports and Accounts of the selected firms from 2008-2013. Ordinary least square regression was used after testing for presence or absence of heteroscedascticity within the study units, longitudinal panel data was used to account for individual heterogeneity of the sample firms. The result revealed that foreign ownership increases the performance of the firm while managerial ownership was found to have negative influence on the performance of the Nigerian conglomerates firms. For institutional ownership and ownership concentration, they were found to have no significant impact on the performance of the firms. The study therefore recommended that, the managers who are the helm of affairs do not control up to 50% or more in . shares allotted in the company, as it gives them too much power and control over other shareholders which may be responsible for the poor performance in a bid to gel short-term private gains. The institutional ownership has been identified to be an important monitoring mechanism in the listed Conglomerates firms. More room should be given to the institutional investors to own shares so that the higher their interest, the more they will be willing to monitor the activities of the firm. Also, since the firms are aware of the vast knowledge owned by institutional investors about how the accounting system works, the managers will be more careful in manipulating the accounting numbers.