Question: Differences in share-ownership patterns can have a significant effect on both the firmis sources of financial capital and its financial performance and riskiness. It will
Differences in share-ownership patterns can have a significant effect on both the firmis sources of financial capital and its financial performance and riskiness. It will also affect the oversight given to the serformance of the firms managers. For example, when corporations exhibit elosed evintrehip structures, they can rely on the share-holding banks and cerporations to provide debt or equity capital to the firm. As a result, the firm's shareholders can aveld * the possibility of ellution in their proportion of share ownerihig. In addition, the firm's manapers are subject to even preater (daily) sonfiny by the fress large, powerfal shareholders. As a mint, there is generally less opportunity for managerial misbehavier in Chand throw relatives to eques firms.
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