Stakeholder interest to mitigate the agency problem in enterprise innovation and the moderating effect of ownership concentration and financial constraints

Abstract

This paper first studies the impact of stakeholder interest on the agency problem by selecting different proxies for key measurements from companies listed on secondboard markets from 2013 to 2019 to investigate the effect of the equity incentive on companies' innovation levels. In addition, this paper adds two moderating variables, ownership concentration and financing constraints, to analyse their moderating effects on the relationships between equity incentives and enterprise innovation.The empirical results show a significant positive correlation between equity incentives and the level of corporate innovation output. In addition, a high degree of ownership concentration can strengthen the positive promoting effect of equity incentives on a company's innovation output. However, when a company faces financing constraints, the promotion effect of equity incentives on the company's innovation will be restrained.

Exploring the mesomeric effect of executive equity incentives on enterprise innovation: a study in the context of digital transformation

“…In terms of corporate governance, Zhao and Yuan (2021) posited that different attributes of the senior management team exert varied impacts on the efficiency of corporate R&D investment and the resulting innovation output; Fang et al (2022) posited that a wider internal salary disparity can boost both the innovation input and output of enterprises. Sun and Xia (2022) discovered a significant positive relationship between equity incentives and the degree of corporate innovation output. Furthermore, the concentration of equity notably amplifies this correlation.…”

“…(2022) posited that a wider internal salary disparity can boost both the innovation input and output of enterprises. Sun and Xia (2022) discovered a significant positive relationship between equity incentives and the degree of corporate innovation output. Furthermore, the concentration of equity notably amplifies this correlation.…”

Corporate Sustainability: The Impact of Environmental, Social, and Governance Performance on Corporate Development and Innovation

“…Companies with good Esg performance tend to demonstrate good, sustainable business development models and philosophies. In the short term, taking on more social responsibility and environmental obligations may increase a company's financing costs [27,28], but in the long term, it is more likely that the company will be recognized by the industry and by the market, which in turn will increase its long-term valuation [29,30].…”

The Impact of Group Control on the Effectiveness of Enterprise Innovation: An Empirical Study

“…The mastery of expertise and cutting-edge technology by a group-controlled company allows for the best deployment of R&D resources within the group, maximizing the company's output of innovation and ultimately enhancing the effectiveness of corporate innovation [17,18]. The way in which the group distributes its internal power is crucial to the allocation of its R&D resources and the effectiveness of innovation in the enterprise is increased by its financial power concentration [19]. The centralization of financial power can help enterprise organizations lessen their reliance on outside finance, while the concentration of affairs and people power can hurt corporate innovation [20,21].…”