The influence of blockownership level and identity on board composition: evidence from the New Zealand market

Burton, B, Gunasekarage, A and Kumarasiri, J 2013, 'The influence of blockownership level and identity on board composition: evidence from the New Zealand market', Applied Financial Economics, vol. 23, no. 16, pp. 1287-1299.


Document type: Journal Article
Collection: Journal Articles

Title The influence of blockownership level and identity on board composition: evidence from the New Zealand market
Author(s) Burton, B
Gunasekarage, A
Kumarasiri, J
Year 2013
Journal name Applied Financial Economics
Volume number 23
Issue number 16
Start page 1287
End page 1299
Total pages 13
Publisher Routledge
Abstract This article explores the relationship between the level and identity of the largest equity blockholding and the proportion of outside directors on the boards of New Zealand corporations between 2002 and 2007, using models that allow for nonlinearity in the relationship as well as interaction between the two exploratory variables. New Zealand provides a unique governance setting for the study, with significant blockholder presence and an inactive (relative to other developed countries) market for corporate control co-existing with a high number of outside directors. The evidence suggests that the proportion of outside directors on New Zealand boards is related to both the level of ownership and identity of the largest blockholder, with the latter influence dominating the former. The evidence regarding blockholder identity suggests that the number of outside directors is likely to be greatest when the stakeholder is governmental or corporate in nature.
Subject Finance
Keyword(s) block ownership
board composition
governance mechanisms
New Zealand
DOI - identifier 10.1080/09603107.2013.804162
Copyright notice © 2013 Copyright Taylor and Francis Group, LLC.
ISSN 0960-3107
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