Ownership Dynamics and Agency Costs: Evidence from Finnish Small Businesses
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School of Business |
Bachelor's thesis
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Date
2024
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Mcode
Degree programme
Rahoitus
Language
en
Pages
24+3
Series
Abstract
Using data of Finnish small private limited liability companies from 2022, I identify the impact of ownership structure on agency costs, proxying agency costs using two ratios derived from companies’ financial statements. I find that companies with a non-owner manager suffer from higher agency costs compared to those in which a manager owns company’s shares, and agency costs tend to increase as the manager’s ownership decreases. Additionally, I discover that agency costs increase as the number of nonmanager shareholders increases.Description
Thesis advisor
Keloharju, MattiKeywords
agency costs, agency theory, Finnish small companies, ownership structure