Foreign ownership and firm performance: evidence from Malaysia

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


Official URL:


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.

Item Type:Article
Keywords:Foreign ownership; performance; Malaysia
Journal:Asian Journal of Accounting and Governance
ID Code:9585
Deposited By: ms aida -
Deposited On:03 Mar 2016 04:06
Last Modified:14 Dec 2016 06:50

Repository Staff Only: item control page