Ownership and Control in Corporate Organisations in Developing Countries: Evidence from a Transition Economy

Otuo Serebour Agyemang, Emmanuel Aboagye


This study examines how internal governance structures in corporate organisations function in ensuring good corporate governance. It contributes to the extant art of knowledge by shedding light on how ownership and board control structures in corporate organisations operate to achieving good corporate governance in developing countries. Using interviews, observations and archival records, catholic and significant data is collected from four large quoted corporate organisations on the Ghana Stock Exchange for the analysis of the study. By linking the data to the theoretical propositions, the study reveals that these four corporate organisations are characterised by the presence of large shareholders and as a result, they tend to wield extensive control over the activities of the companies through their involvement in the decision-making processes. This sort of involvement by large shareholders in the decision-making processes of the companies is as a result of the incessant flow of information from the companies’ management to them. However, whilst the presence of large shareholders has the tendency to solving the principal-agent problem, it poses challenges in regards to minority shareholders’ interests in these corporate organisations. Small equity holders of the companies only rely on the minimum statutory disclosures in the annual reports of the companies and are always relegated to the background in times of information sharing. The study also highlights that boards of directors tend to exercise control over corporate organisations when majority shareholders stop interfering in their dealings. This implies that when major shareholders fully partake in corporate decision-making processes of companies, boards of directors seem to be sheer advisory bodies to management.

Keywords: Ownership control, Board control, Board of directors, Ownership structure, Corporate Governance, Ghana.

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ISSN (Paper)2222-1905 ISSN (Online)2222-2839

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