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Shareholding Pattern
Shareholding Pattern
shareholders. This is more commonly the share ownership pattern in the United States and the United
Kingdom. A concentrated ownership system is more common in continental Europe. In this system one
shareholder, family, or group of shareholders has majority or dominant control of companies. Different
types of fraud are incentivized under each system. Dispersed ownership systems encourage earnings
management, so executives benefit from short‐term performance measures. Concentrated control
encourages appropriation of private benefits of control. Corporate governance is designed to protect
shareholders' interests. Corporate ownerships systems have implications on the efficacy of governance
techniques. © 2016 Wiley Periodicals, Inc.