Institutional Ownership and Firm Performance – Role of Managerial Efficiency: Evidence from Thai Stock Exchange
Keywords:
institutional ownership, managerial efficiency, firm performanceAbstract
The purposes of this study are to investigate how institutional ownership (INS) impacts firm performance, and whether "managerial efficiency" can moderate the relationship between INS and firm performance. The study was conducted based on agency theory. The data were collected from the SETSMART database, which includes information on companies listed on the Thailand Security Exchange from 2016 to 2021. The study used a process regression analysis with 2,104 observations, examining the relationship between institutional ownership and firm performance (measured by ROA and Tobin's Q), while also taking into account the managerial efficiency. The findings suggest that managerial efficiency played an important role in the relationship between institutional ownership and firm performance. This should be considered prior to making an investment decision. This study addresses conflicting arguments and gaps in the literature regarding the relationship between institutional ownership and firm performance, together with highlighting the importance of managerial efficiency in creating effective efficiency.References
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