Governance and Performance of Spanish Privatised Firms


*Department of Business Administration, University of León, Campus de Vegazana s/n, León 24071, Spain. Tel: 34-987-29100 (extension 5479); Fax: 34-987-291454; E-mail:


This paper analyses the effect of the Spanish privatisation process on the performance and corporate governance of the firms that were privatised through public offerings over the 1985–2003 period. Using conventional pre- versus post-privatisation comparisons, we do not find significant improvements in privatised firms' profitability and efficiency. However, our results do suggest a change in firms' ownership structure and in the characteristics of Boards of Directors after privatisation. Firms' ownership concentration decreases as a consequence of the relinquishment of control by the State and the Boards of Directors are restructured with the creation of new specialised committees and the incorporation of more executives.