The effects of ownership concentration on sustainability: A case of listed firms from USA, UK and German

Abstract

Concentrated ownership has been speculated to play a direct role in leading firms to focus more on long-term sustainability. Concentrated ownership, however, can take many different forms, with some forms more common in certain countries, and we posit that the specific form of ownership mediates the impact on sustainability. Additionally, we posit that firms operating at different scales have fundamentally different characteristics which can further impact this relationship. Analyzing a sample of firms from the USA, UK, and Germany using Arellano- Bond GMM, we investigate the relationship between ownership concentration, firm growth and sustainability measures comparatively. Our results show that these relationships are not linear, but are rather dependent on the prevalent form of ownership concentration (determined by country) and the scale (small, medium or large) of the firm. Approaches to sustainability appear to be influenced by not just the owners / investors but also by the type of control and broader contexts, explaining differing national trends.