Ownership Governance Mechanisms and Firm Performance in Norway

Abstract

We investigate the relationship between ownership governance mechanisms and firm performance using extensive panel data of medium- and large-sized Nor-wegian firms from 2000 to 2015 and find that several mechanisms are relevant de-terminants of firm performance. We identify a curvilinear interaction between own-ership concentration and firm performance, with evidence supporting a weakly con-cave relationship that retains its relevance even when considered in conjunction with other mechanisms. Insider ownership does not have an apparent directional effect on firm performance, neither on a linear nor non-linear basis, on both single- and multi-mechanism model specifications. Institutional ownership has a positive association with performance, whereas we cannot establish a link between state ownership and the performance of firms in our sample. Our research deepens the understanding of ownership governance mechanisms, their inter-linkages, and the extent to which they affect firm performance.