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PurposeThis paper aims to test the impact of corporate governance structure on corporate values.Design/methodology/approachThe paper employs factor analysis and three‐stage least squares to identify and explain variance in corporate values.FindingsIn accordance with the proposed theoretical framework ownership, board and stakeholder structure are found to influence corporate values. When value determinants are taken into account there is no significant relationship between values and profitability.Research limitations/implicationsThis is a pilot study of 71 Danish firms. Further research needs to address measurement of corporate values and to test hypotheses on larger datasets.Practical implicationsOne practical implication is that corporate values should be grounded in the company's ownership, board and stakeholder structure. Real changes in corporate values may require real changes in governance structure.Originality/valueThe paper tests a new approach to the study of corporate values which connects values to governance. It thereby establishes empirical foundations for current discussions about corporate values. This should be important both to practical work on company missions, values and responsibilities and to academics who search for an operational approach to the study of corporate values.

There is growing interest in corporate values but where do they come from? What factors determine corporate values? This paper argues that they are determined by corporate governance in a broad sense of the word. Three governance mechanisms are emphasized: ownership structure, board composition and stakeholder influence. In smaller companies founder‐owners often play a pivotal role in shaping corporate value systems that influence companies for years to come. In larger companies that separate ownership and control, managers and boards come to play a powerful role. In both cases repeated interaction with customers, employees and other stakeholders shape corporate values by way of corporate reputation and corporate culture.

Industrial foundations are private, self‐governing institutions that own business companies. This ownership category is quite common in Northern Europe although it appears to violate the basic principles of the (Anglo‐American) neoclassical corporation: profit maximization and risk diversification. The paper examines the economic performance of foundation‐owned companies using accounting data drawn from a sample of the 300 largest Danish companies 1982‐1992. Surprisingly, it is found that foundation‐owned companies perform slightly better than companies with private (personal) or public (dispersed) ownership. Foundation‐owned companies appear to specialize in capital and research intensive activities with high profit‐sales ratios which indicates that they are competitive in activities that require continuous long run investment. A parallel paper proposes a theoretical explanation.