Asset utilization efficiency and ownership structure: Evidence from emerging and developing Eastern Europe

Abstract

Does ownership structure have any effect on efficient use of company assets? If so, what are the ownership-related determinants of asset utilization efficiency? In this study we are seeking answers to these questions for firms operating in emerging and developing Eastern Europe. Our results support the view that ownership structure has a determinant role in efficient use of company assets. Main findings from our sample are as follows. Assets are used more efficiently in owner-managed firms than outsider-managed firms both for large-sized companies and medium-sized companies. For large-sized companies, efficiency increases with the ownership share of executives and the controlling family ownership, while decreasing with the number of non-manager shareholders and the ownership share of non-manager block holders. For medium-sized companies, efficiency increases with the controlling family ownership