Modelling agency problems in Malaysian pyramid structures

The purpose of this research is to propose the models to examine the determinants of affiliation to pyramid firms and to investigate the effects of pyramid firms towards corporate value. Previous research have documented that in many East Asian firms, the ultimate owners showed a mismatch in cash flow rights and control rights which leads to expropriation of minority shareholders' interest. The method adapts Attig Model and the unit of study is pyramidal firms in Malaysia. It shows that there is a difference between cash flow rights and control rights among Malaysian pyramidal firms which bring negative implication towards corporate value.