Political Connections in Ownership Structures: The Government as a Shareholder in a Descriptive Analysis

Abstract

With the growing interest in the economic literature on government activism, one realizes that the government starts to influence the economic and productive activity in Brazil more intensely (FUCS; CORONATO, 2011). From the perspective of the theory of corporate political strategy, the main objective of this work is to analyze the structure of ownership with government shareholding in Brazilian companies listed on the BM&FBOVESPA, on the period 1999-2010. The study explores the government´s presence in various spheres which they federal, state and municipal structures owned Brazilian companies listed on the BM&FBOVESPA, which demonstrates its uniqueness in relation to other studies in the country. Considers two forms of government identification as a shareholder: direct (public companies, state-owned company, federal authorities, national development banks or regional development funds and social funds social participation), indirect (pension funds by state-owned enterprises), segregating in the majority or minority stake. Among the main results, first confirmed the assumption of previous studies that investigate the ownership structure in Brazil, that the majority of Brazilian companies listed on the BM&FBOVESPA have the concentrated structure of ownership, indicating the presence of the figure of a controlling shareholder, in which it was found that on average the largest shareholder owns 62.77 % of the voting capital and 49.78 of the total capital of the company. Also the results indicate that the government, when you compose the ownership structure of firms has a significant share in the economy, even participated directly 13.71 % of public companies traded on the BM&FBOVESPA. Since past 12 years, he owned on average 49.72 % of the shares with voting rights and 39.01% of the total shares of each company, indicating that the government controls the companies when directly involved with them. So noticeable that while the government diversifies its corporate relations in sectors as this is not only concentrated in a few sectors, most is present in all sectors of the economy at different levels of performance.