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The purpose of this paper is to complement existing research of the relationship between concentrated ownership and firm performance by theoretically exploring the impact of outside blockholders on the firm, primarily from the perspective of voting power.

This paper proposes theoretical propositions based on analyses and logical extension of results of the existing theoretical and empirical studies.

This paper proposes three theoretical predictions: First, voting power provides outside blockholders a necessary condition to pursue shared and private benefits of control, and it is positively correlated with blockholders’ capability of influencing firm value. Second, everything else being equal, an outside blockholder is more (less) likely to pursue private benefits than shared benefits when the equity market is efficient and when the blockholder’s voting power is less (more) than 50 per cent. Third, controlling outside blockholders can capitalize on their voting power to appoint managerial delegates and board representatives to the invested firms for the purpose of pursuing private benefits of control.

This paper tries to make two contributions to the corporate governance literature. First, this research relies on a new perspective to explore the relationship between ownership structure and firm value. Second, this paper presents the first theoretical argument which states that controlling outside blockholders rely on their managerial delegates and board representatives to pursue their private benefits of control.

This study aims to investigate the relationship between the ownership structure of firms and the private benefits of control through an analysis of Chinese listed firms.

Using a sample of Chinese firms, cases were examined where there had been a transaction involving non‐tradable stock. The cases where there had been stock transactions which both did and did not involve the transfer of control within a single year were selected. The difference between these two types of transaction was used to estimate the private benefits of control in Chinese listed firms. Regression analysis was used to explore the relationship between ownership structure and private benefits of control in Chinese listed firms.

The results show that the average private benefit of control is 18.52 percent in China. The regression results show a significant, positive relationship between the controlling shareholders, the combined shareholdings of the second to fifth largest shareholder and private benefits of control. However, there is a negative but insignificant relationship between the tradable share value and private benefits of control. With regard to the relationship between managerial shareholding and private benefits of control, the regression results show a positive but insignificant relationship.

Further insights into the private benefits of control can be obtained by inspecting the change around major corporate events involving significant ownership changes. In this study, the focus was on non‐tradable stock. Investigating all stock would be a fruitful area for future research.

In China, firms should optimize the ownership structure and curb expropriation by controlling shareholders. This would help to promote a sound development of Chinese listed firms and the capital market.

The research provides useful information on the impact of ownership structure on private benefits of control in a sample of listed firms in China.

The purpose of this paper is to investigate the relationship among ownership structure, information disclosure and benefits of control under Lab‐experimental frame, based on the ownership structure in China's stock market.

Theoretical Shapley value of shareholders was used as the representative of control right, and benefits of control in different experimental treatments were studied.

Experimental results show: first, more counterbalance of shareholders' control rights, less benefits of their control right. Accordingly, more chance to form core alliance for the major shareholder with small shareholders, less chance for them to get control right; second, the effect of information on benefits of control are mainly reflected in forming and maintaining the alliance; third, Shapley value of the major shareholder and the information determine the alliance type; fourth, control premium may be the cost of keeping the major shareholder's benefits safe and fifth, imperfect information is not always bad, concealing information partly can improve the distribution efficiency of a corporation.

The paper provides experimental analysis of the behavioral logic behind the benefits of control, which would help to explain the relationship among ownership structure, information disclosure and benefits of control.

This study aims to understand the organisational benefits of carbon-focussed management control systems (carbon MCS) under a regulatory context.

The authors conduct a survey of 85 New Zealand (NZ) organisations covering different industries, sizes and compliance obligations.

The results suggest a significant direct positive impact of carbon MCS on organisations’ non-financial benefits and an indirect impact on financial benefits via non-financial benefits. The impact on non-financial benefits is strongest when a whole carbon MCS package is used rather than individual carbon controls. However, the highest impact on financial benefits are attained when only diagnostic controls are used rather than other controls or the whole MCS package. Firms in primary, manufacturing and energy sectors and those with export activities are less likely to achieve organisational benefits, while those with a compliance obligation under the emissions trading scheme are more likely to perceive such benefits.

The study has a limited sample size (85 firms), a unique context (NZ) and coves only large firms. Further, there are no objective performance measures to validate survey responses regarding organisational benefits.

The findings provide a business case for managers and practitioners in formulating their strategic and MCS responses to climate change issues.

The authors focus on carbon MCS and adopt a wider range of carbon MCS levers than previous research. The authors discern not only non-financial benefits but also financial benefits from MCS use.

Concentrated ownership implies greater alignment between ownership and control, mitigating the agency problem. However, it may also engender governance challenges such as funds appropriation through related party transactions and the oppression of minority shareholders, especially in the context of weak legal systems. We draw from legal theory (the tradeoff controlling shareholder model and private benefits of control) and from organization theory (socioemotional wealth), to suggest that concentrated ownership can be beneficial in both robust and weak legal systems for different reasons. We advance theory on the effects of controlling shareholders and suggest that the longer-term outlook associated with engaged concentrated ownership can aid the shift of the corporation toward Berle and Means' (1932, p. 355) “third possibility” of corporations serving the interests of not just the stockholders or management but also of society.

The purpose of this paper is to examine the incentives of controlling shareholders in the market for corporate control. The author investigates the takeover premiums paid by a sample of European acquiring firms with voting rights structures that are highly concentrated. The results show a positive relationship between takeover premiums and the bidder’s concentration of both voting rights and excess voting rights over cash-flow rights. The author argues that with higher levels of entrenchment, takeover premiums reflect the private benefits of control which controlling shareholders in bidding firms seek to extract from a public transaction.

This paper uses cross-sectional regression analyses to examine the relationship between takeover premiums and the extent to which bidding firm shareholders exert control as well as the arrangement which underlie this. The sample is composed by 210 deals. The data are collected from various databases (Thomson Financial’s Mergers and Acquisition; Faccio and Lang’s (2002); Datastream/Worldscope, LexisNexis).

The premium paid in European M&A transactions is affected by the level of ownership exerted by the controlling shareholder. The results show premiums are positively and significantly associated with higher levels of voting rights, as well as, the level of separation of ownership and control when controlling shareholder ownership is low. Pyramiding structure seems to be the means of separation the most associated with takeover premiums.

This paper can be improved by other specifications. First, it would be interesting to analyze premiums paid by firms with dispersed ownership structure and to compare these premiums with those paid by firms with controlling shareholders. Second, the author suggests to examine whether a controlling shareholder occupy the seat of a CEO or a chairman. In these cases, the author assumes that the controlling shareholder can benefit from more discretion and can extract more private benefits. Third, the author suggests extending the sample period to 2007 at least to include the sixth wave. This wave was even more significant than the high-tech wave and has not been studied much. In these cases, the author assumes that the controlling shareholder can benefit from more discretion and can extract more private benefits.

Previous studies show that the premium reflects the private benefits of control in privately negotiated transactions (mainly block transactions). In the present study, the author shows that the premium can also reflect private benefits in public merger transactions.

The article describes a new approach to the cost/benefit aspect of management control systems which will help managers decide which control system is worthwhile improving and how. The new concept is based on two ideas: defining the purpose of a control system as: “Triggering corrective action that will prevent losses which came out of deviation from planned path”; and breaking up the control cycle into five steps and relating separately to each step for improving the present system and its cost/benefit performance.

The chapter investigates three channels through which private benefits are hypothesized to be extracted in dual class companies: excess executive compensation, excess capital expenditures and excess cash holdings.

With a propensity score matched sample of S&P 1500 dual class and single class companies with concentrated control, the chapter analyzes the relationship between the valuation discount of dual class companies and measures of excess executive compensation, excess capital expenditure and excess cash holdings.

Executives in dual class firms earn greater compensation relative to their counterparts in single class firms. This excess compensation is more pronounced when the executive is a family member. The value of dual class shares is discounted most when cash holdings and executive compensation of dual class are excessive. Excess compensation is highest for executives who are family members of dual class companies. The dual class discount is not related to excess capital expenditures.

The research shows that the discount in the value of dual class shares in relation to the value of closely controlled single class company shares is directly related to the channels through which controlling shareholder-managers can extract private benefits.

Strong versions of the Precautionary Principle (PP) require regulators to prohibit or impose technology controls on activities that pose uncertain risks of possibly significant environmental harm. This decision rule is conceptually unsound and would diminish social welfare. Uncertainty as such does not justify regulatory precaution. While they should reject PP, regulators should take appropriate account of societal aversion to risks of large harm and the value of obtaining additional information before allowing environmentally risky activities to proceed.