THE EFFECTS OF BUSINESS GROUP CONTROL ADVANTAGES AND AFFILIATE LEVEL ADVANTAGES ON AFFILIATE PERFORMANCE

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Abstract

This study views the network of control in a corporate business group as its source of competitive advantages. These control advantages are distributed among the business group affiliates and eventually influence their performance. This paper examines this by providing a reconceptualization of both the nature of business group and affiliate level advantages using the data of the top 20 Philippine corporate groups. The study found out that the group level control advantage affects the affiliate performance more than their individual level advantages. This result confirms the capability of business groups to influence and control their group internal market. This also implies that the business group affiliates have not yet developed significant capabilities which are independent to that of their business group.

Keywords: Corporate Groups, Business Group Advantages, Affiliate Level Advantages, Business Group Affiliation, Director Interlocks, Network Analysis

How to cite this paper: Bugador, R. (2015). The effects of business group control advantages and affiliate level advantages on affiliate performance. Corporate Ownership & Control, 13(1), 125-135. https://doi.org/10.22495/cocv13i1p12