Introduction

This research provides the first comprehensive global documentation of common and universal ownership, covering 70,349 publicly listed firms across 49 countries from 2005 to 2023. These economies collectively account for 86% of global GDP. The practice of common ownership—where two or more competing firms are partially owned by the same investors—has drawn significant attention from antitrust authorities and legal scholars due to potential anticompetitive effects. The 2023 U.S. Merger Guidelines recently recognised that transactions leading to or involving common ownership may raise competitive concerns and should be evaluated under the same frameworks as full mergers.

Data

To construct measures of universal and common ownership, the authors utilise the LSEG Global Ownership database. This source identifies shareholdings by 13F institutions, mutual funds, pension funds, and other institutional investors, while also capturing large stakes by non-institutional owners like individuals, families, or government institutions. The research builds on theoretically informed measures of ownership, primarily focusing on implied profit weights (κ). The study adopts a “one share, one vote” assumption as its baseline for calculating profit weights, ensuring comparability across different countries and time periods.

Descriptive results

Common ownership is pervasive and rising around the world. In the median country, average pairwise implied profit weights more than doubled over the sample period, and they more than tripled in the United States. While the United States remains a clear outlier with an average pairwise κ for the full sample of firms equal to 0.1583, other countries with notably high levels include Ireland (0.1147), China (0.1017), and South Africa (0.0849). Within Europe, a distinct North-South divide exists; Northern European countries such as the Netherlands and the Nordic economies exhibit substantially higher levels of ownership overlap than Southern counterparts like Italy and Spain. Variance decomposition reveals that overlapping ownership is the dominant driver of variation in κ in every country, accounting for at least 75% of the variance in the cross-section.

Drivers of common ownership

A consistent pattern observed across all regions is a steep size gradient. Universal and common ownership are on average three times higher for above-median firms than for the full firm universe, and the gap widens further for top-tercile firms. This pattern is particularly pronounced in developed capital markets where institutional investors hold larger stakes in high market-cap firms. The rise of common ownership stems not just from more institutional investment but from its increasing concentration among a few megaproviders of capital, such as the Big Three (BlackRock, Vanguard, and State Street). In the United States, these asset managers became the largest shareholder in over 35% of public companies by 2023, up from under 3% in 2005. Outside the United States, although individual stakes remain modest, the Big Three contribute disproportionately to increases in common ownership due to the extraordinary breadth of their portfolios.

Case study: Japan’s ETF purchasing programme

In Japan, the rise of universal ownership only began in 2014, driven by the Bank of Japan’s (BoJ) quantitative easing policy and its ETF purchasing programme. This programme, which expanded in scale to achieve a 2% inflation target, involved aggressive asset purchases via ETFs tracking the Nikkei 225, the TOPIX, and the JPX-Nikkei 400. This policy raised ownership stakes across nearly all listed firms simultaneously, mechanically increasing universal ownership. This significant shift in ownership occurred through the “Japanese Big Three” (Nomura Asset Management, Nikko [now Amova], and Daiwa Asset Management) as well as BlackRock Japan Co., Ltd.

Institutional determinants of common ownership

Cross-country variation in common ownership is systematically related to legal and institutional characteristics. Stronger antitrust and competition laws and enforcement are associated with lower common ownership. Specifically, abuse of dominance provisions and anticompetitive agreement provisions exhibit strong negative relationships. Conversely, more complex and burdensome market entry regulations, measured by the number of administrative procedures and time required to start a business, are positively associated with higher levels of common ownership. Rigid labour protections and collective labour relations correlate with lower common ownership, likely by limiting investor influence over workforce decisions. Robust investor protections, such as those measured by the Anti-Self-Dealing Index, appear to promote common ownership by facilitating institutional investment. Regarding environmental, social, and governance (ESG) factors, government-led ESG disclosure requirements are associated with a significant decrease in common ownership, whereas stock exchange-imposed requirements show no significant relationship. Finally, poor regulatory quality is positively associated with common ownership levels.

Dual-class shares and control chains

The results are generally robust to replacing the “one share, one vote” assumption with control rights measured from ownership filing traces and dual-class share structures. Replacing assumed control with measured control rights based on ownership filings (tracing 755,944 firm-owner links) leaves the overall growth patterns and country rankings essentially unchanged outside a small set of concentrated-ownership markets. In the United States, reinstating multi-class firms removed by the initial screen lowers the measured country-average profit weight by approximately 14.2%, yet the United States remains the clear global outlier with the highest average profit weight in the sample.

Conclusion

Common ownership is a global and accelerating phenomenon concentrated among the largest firms and driven by a small number of dominant passive investors. These findings carry significant implications for financial regulators and competition authorities, suggesting that the substantial cross-country variation and its relationship with legal frameworks mean policy design can meaningfully shape the prevalence and structure of common ownership worldwide. Understanding these global patterns is an essential first step toward informed and well-targeted regulatory responses.