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Title: The impacts of multiple large ownership structure on board independence

Authors: Ismail Adelopo; Yinusa Ganiyu Olumuyiwa; Ibrahim Rufai

Addresses: University of the West of England, Frenchay Campus, BS16 1QY, Bristol, UK ' Department of Accounting, Banking and Finance, Olabisi Onabanjo University, Ago-Iwoye Ogun State, Nigeria ' Business School, Staffordshire University, Staffordshire, UK

Abstract: The determinants of the composition of corporate boards remain inconclusive. This study investigates the impacts of multiple large ownership structure on board independence for a sample of UK listed companies. Using multiple regression analysis, and controlling for endogeneity, the study shows that the larger the difference in shareholding between the first and second largest owners, the less independent is the board. Monitoring efficiency is enhanced the higher the ratio of the shareholding of the second largest shareholder relative to the shareholding of the first largest shareholder. These findings have significant implications for board monitoring and corporate governance regulations.

Keywords: multiple large ownership structure; MLS; corporate governance; board independence.

DOI: 10.1504/IJAAPE.2019.096732

International Journal of Accounting, Auditing and Performance Evaluation, 2019 Vol.15 No.1, pp.1 - 30

Received: 29 Dec 2016
Accepted: 15 Sep 2017

Published online: 19 Nov 2018 *

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