Foreign ownership and firm performance: evidence from Malaysia
It is a known fact that foreign multinational firms hold significant ownership in firms listed on Bursa Malaysia. These foreign owners do not only provide capital, but also managerial expertise and exceptional monitoring mechanism on managers. Therefore, it can be expected that foreign ownership imp...
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| Format: | Article |
| Language: | English |
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Fakulti Ekonomi dan Pengurusan
2015
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| Online Access: | http://journalarticle.ukm.my/9585/ http://journalarticle.ukm.my/9585/1/7326-33169-1-PB.pdf |
| _version_ | 1848812137819930624 |
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| author | Mohd Abdullah Jusoh, |
| author_facet | Mohd Abdullah Jusoh, |
| author_sort | Mohd Abdullah Jusoh, |
| building | UKM Institutional Repository |
| collection | Online Access |
| description | It is a known fact that foreign multinational firms hold significant ownership in firms listed on Bursa Malaysia. These foreign owners do not only provide capital, but also managerial expertise and exceptional monitoring mechanism on managers. Therefore, it can be expected that foreign ownership improves firm performance and efficiency. However, the extent to which their participation in ownership could improve firm performance particularly in emerging countries such as Malaysia has to be empirically tested. This study investigates the relationship between foreign ownership and firm performance of public listed firms in Malaysia. Three years panel data of 730 Malaysian public listed firms were examined. The results show that foreign ownership has positive and significant relationship with ROA and Tobin’s Q. Therefore, the involvement of foreign investors in monitoring and controlling activities reduces agency conflict in the emerging economy. This is the first study that utilizes the extended agency theory to explain foreign ownership and performance in a developing country. |
| first_indexed | 2025-11-14T23:57:31Z |
| format | Article |
| id | oai:generic.eprints.org:9585 |
| institution | Universiti Kebangasaan Malaysia |
| institution_category | Local University |
| language | English |
| last_indexed | 2025-11-14T23:57:31Z |
| publishDate | 2015 |
| publisher | Fakulti Ekonomi dan Pengurusan |
| recordtype | eprints |
| repository_type | Digital Repository |
| spelling | oai:generic.eprints.org:95852016-12-14T06:50:22Z http://journalarticle.ukm.my/9585/ Foreign ownership and firm performance: evidence from Malaysia Mohd Abdullah Jusoh, It is a known fact that foreign multinational firms hold significant ownership in firms listed on Bursa Malaysia. These foreign owners do not only provide capital, but also managerial expertise and exceptional monitoring mechanism on managers. Therefore, it can be expected that foreign ownership improves firm performance and efficiency. However, the extent to which their participation in ownership could improve firm performance particularly in emerging countries such as Malaysia has to be empirically tested. This study investigates the relationship between foreign ownership and firm performance of public listed firms in Malaysia. Three years panel data of 730 Malaysian public listed firms were examined. The results show that foreign ownership has positive and significant relationship with ROA and Tobin’s Q. Therefore, the involvement of foreign investors in monitoring and controlling activities reduces agency conflict in the emerging economy. This is the first study that utilizes the extended agency theory to explain foreign ownership and performance in a developing country. Fakulti Ekonomi dan Pengurusan 2015 Article PeerReviewed application/pdf en http://journalarticle.ukm.my/9585/1/7326-33169-1-PB.pdf Mohd Abdullah Jusoh, (2015) Foreign ownership and firm performance: evidence from Malaysia. Asian Journal of Accounting and Governance, 6 . pp. 49-54. ISSN 2180-3838 http://ejournal.ukm.my/ajac/issue/view/748/showToc |
| spellingShingle | Mohd Abdullah Jusoh, Foreign ownership and firm performance: evidence from Malaysia |
| title | Foreign ownership and firm performance: evidence from Malaysia |
| title_full | Foreign ownership and firm performance: evidence from Malaysia |
| title_fullStr | Foreign ownership and firm performance: evidence from Malaysia |
| title_full_unstemmed | Foreign ownership and firm performance: evidence from Malaysia |
| title_short | Foreign ownership and firm performance: evidence from Malaysia |
| title_sort | foreign ownership and firm performance: evidence from malaysia |
| url | http://journalarticle.ukm.my/9585/ http://journalarticle.ukm.my/9585/ http://journalarticle.ukm.my/9585/1/7326-33169-1-PB.pdf |