find thatwhile 37 percent arewidelyheld, 44 percent are
family controlled, with dual-class shares and pyramid
structures. Smaller firms on continental Europe are more
likely to be family controlledwhereas larger firms in the
UnitedKingdom and Ireland aremorelikely to be widely
held.
21 L. Bebchuk, R. Kraakman, and G. Triantis, “Stock
Pyramids, Cross Ownership and Dual Class Equity: The
MechanismsandAgency CostsofSeparatingControlfrom
Cash Flow Rights,” working paper, Harvard Law School,
2000.Forpyramiding, theyoffertheexampleoftheHong
Kongbased LiKa-shinggroup,which owns 35 percent of
CheungKongCompany,which,inturn,owns 44 percentof
Hutchison Whampoa, which owns CavendishInternational,
which controls Hong Kong Electric.
22 Asanexample,considertheLippoGroup,comprisedof
three Indonesiancompanies—LippoBank, Lippo Life,and
LippoSecurities—allcontrolledbytheRiadyfamily.Though
thefamilydivesteditselfofitsholdingsinLippoBankinthe
1990s,itcontrolsallthreecompaniesthroughitsholdingsin
Lippo Securities, which holds 27 percent of Lippo Life,
which holds 40 percent of Lippo Bank.
23 D. Del Guercio and J. Hawkins, “The Motivation and
Impact of Pension Fund Activism,” Journal of Financial
Economics 52 (1999): 293-340. The authors study five
activistpension funds—CREF,Calpers,CALSTRS, SWIB,
andNYC—whichaccountfor 20 percentofallpensionfund
investment between 1987 and 1993, and conclude that
companiesthattheyownstockinaremorelikelytobetargets