The impact of institutional investors on the financial performance of Russian companies-Reference-Cited by-同舟云学术

The impact of institutional investors on the financial performance of Russian companies

Published:2024-07-30 Issue:7 Volume:30 Page:1510-1526
ISSN:2071-4688
Container-title:Finance and Credit
language:
Short-container-title:FC

Author:

FEDOROVA Elena A.¹^ORCID,TOLMACHEVA Ekaterina K.¹

Affiliation:

1. Financial University under Government of Russian Federation

Abstract

Subject. This article examines the impact of institutional investors on the financial performance of Russian companies. Objectives. The article aims to assess the impact of institutional investors on the financial performance of Russian companies and test two hypotheses, namely the direct relationship between the share of institutional investors in the company's capital and its financial performance, as well as whether there is a negative relationship between the State's share in the company's capital and its financial performance. Methods. For the study, we used linear regression. Empirical data contain observations on the 59 largest companies in Russia by capitalization in 2021, as well as on the owners of these companies, where 30 percent of the shareholders turned out to be State entities/companies, and only 18 percent of the owners can be attributed to institutional investors. Results. The article presents a model that explains the change in the profitability of companies' assets, taking into account the factors of institutional and State participation in them, and it is built using linear regression. The results of the study did not confirm the existence of a positive relationship between the profitability of the company's assets and the presence of an institutional investor among the owners. The hypothesis of lower profitability among companies with State participation is confirmed. Conclusions and Relevance. The study conducted using regression analysis methods showed the absence of a positive impact of institutional investors on the profitability of Russian companies. The volume of assets of Russian institutional investors is insufficient for full-fledged investments in the country and the development of the financial market, which also hinders the formation of symbiotic relations between investors and companies. The results obtained are the basis for further research of institutional investors in the Russian financial market, and are also applicable in practice for forecasting the financial results of public companies.

Publisher

Publishing House Finance and Credit

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