11th Economics & Finance Conference, Rome

IMPACT OF INSTITUTIONAL OWNERSHIP ON FIRM PERFORMANCE; EVIDENCE FROM FINANCIAL AND NON-FINANCIAL FIRMS

MUZZAMMIL HUSSAIN, FAREEHA ABID, SYEDA AMBREEN ZAHRA, NASIR MAHMOOD

Abstract:

This study investigates the impact of institutional ownership structure on firm performance listed on Pakistan stock exchange. This study shed a light on the role of institutional ownership structure in firm performance. Institutional ownership classified in four categories, foreign institutional ownership, domestic institutional ownership, state institutional ownership and private institutional ownership. Tobin’s Q are used as a proxy to measure the firm performance. We proceeded with a sample of 40 firms from 2006- 2016. The data are equally distributed in financial and non-financial firms. The panel data regression is used to analyzed the data. Institutional ownership structure has been measured through the foreign and domestic institutional ownership. Results disclose that institutional ownership has significant impact on financial firms while on the other side it has insignificant impact on non-financial firms. The percentage of institutional ownership in Pakistan is higher in non-financial firm as compare to the financial firms. Institutional ownership is most important features of the sample.

Keywords: Ownership structure, Institutional ownership, Firm performance, financial firms, Non-financial firms