RESEARCH NOTES AND COMMUNICATIONS DOES CORPORATE OWNERSHIP STRUCTURE AFFECT ITS STRATEGY TOWARDS DIVERSIFICATION?

摘要

We claim that there is a link a between corporate control structure and managers' strategy twoards unrelated mergers and risk diversifcation. Companies with greater ownership concentration are less diversified. Evidence also shows that corporate diversification generally results in value loss while focussing is value increasing. Thios hgihlights the potentially detrimental effect of agency problems on corporate strategy.