The role of large shareholders in corporate risk and its impact on value in times of crisis

Abstract

Before the 2007 financial crisis, companies seized the opportunities that arose from deregulation, sometimes making questionable decisions about the value of their actions. It's important to underscore this period because the absence of regulation and financial excesses exceeded the anticipated benefits of these opportunities (Palley, 2011; 2019). Nonetheless, it ultimately led to an economic recession. Consequently, the literature has identified a connection between increased risk-taking and greater value creation. However, this relationship, particularly in times of financial uncertainty, is shaped by the ownership structure of firms