Does Ownership Structure Influence Firm Performance? A Panel Evidence From India

Abstract

The study examines the relationship between corporate ownership structure and firm performance through the lens of accounting theory, positioning ownership as a mechanism of accounting control, stewardship, and information alignment. Ownership structure, defined by the distribution of equity among shareholders, has long been recognized as shaping organizational behaviour and outcomes. Drawing on agency theory, stewardship theory, and accounting control theory, the study explores how alternative ownership configurations including concentrated, dispersed, institutional, and family ownership shape the interpretation and effectiveness of accounting-based and market-based performance measures, rather than merely influencing governance outcomes. It reconceptualises ownership as an accounting-relevant mechanism influencing performance measurement, monitoring, and reporting credibility. By examining how ownership structures influence decision-making processes and resource allocation, the study advances conceptual understanding of how accounting information functions under different ownership regimes. The study extends agency theory and accounting control theory by reconceptualizing ownership structure as an integral component of accounting control and reporting systems, while challenging the implicit assumption in stewardship-based and performance measurement research that accounting outcomes are ownership-neutral. It demonstrates that ownership patterns influence the meaning, reliability, and interpretation of reported outcomes. The implications extend to accounting researchers and standard setters by clarifying how ownership structures shape stewardship, accountability, and the evaluative role of accounting in organizational sustainability.