Institutional ownership and firm performance in the global shipping industry
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In: Transportation Research Part E: Logistics and Transportation Review, Vol. 146, 102152, 01.02.2021.
Research output: Journal contributions › Journal articles › Research › peer-review
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TY - JOUR
T1 - Institutional ownership and firm performance in the global shipping industry
AU - Drobetz, Wolfgang
AU - Ehlert, Sebastian
AU - Schröder, Henning
N1 - Funding Information: The authors are grateful for financial support from the Maritime Economics Research Center (MERC) at Hamburg Business School. We thank three anonymous referees, Simon Döring, Manolis Kavussanos (guest editor), Tizian Otto, and Ignacio Requejo for valuable comments. Publisher Copyright: © 2020 Elsevier Ltd
PY - 2021/2/1
Y1 - 2021/2/1
N2 - We examine the effect of institutional investors on the valuation of listed shipping firms. Institutional investors have a positive influence on the market value of shipping firms, confirming that institutional ownership is a “universal” corporate governance mechanism. This valuation effect is more pronounced in firms dominated by institutional investors with a short-term investment horizon. It is also stronger in firms with high stock liquidity, suggesting that short-term investors, through the threat of exit, are able to mitigate agency conflicts and improve corporate governance. Investment regressions indicate that shipping firms with a larger fraction of short-term investors are better able to exploit growth opportunities.
AB - We examine the effect of institutional investors on the valuation of listed shipping firms. Institutional investors have a positive influence on the market value of shipping firms, confirming that institutional ownership is a “universal” corporate governance mechanism. This valuation effect is more pronounced in firms dominated by institutional investors with a short-term investment horizon. It is also stronger in firms with high stock liquidity, suggesting that short-term investors, through the threat of exit, are able to mitigate agency conflicts and improve corporate governance. Investment regressions indicate that shipping firms with a larger fraction of short-term investors are better able to exploit growth opportunities.
KW - Corporate governance
KW - Firm value
KW - Institutional investor
KW - Investment horizon
KW - Shipping industry
KW - Management studies
UR - http://www.scopus.com/inward/record.url?scp=85098942611&partnerID=8YFLogxK
U2 - 10.1016/j.tre.2020.102152
DO - 10.1016/j.tre.2020.102152
M3 - Journal articles
AN - SCOPUS:85098942611
VL - 146
JO - Transportation Research Part E: Logistics and Transportation Review
JF - Transportation Research Part E: Logistics and Transportation Review
SN - 1366-5545
M1 - 102152
ER -