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Summary:

R&D capabilities are crucial for companies to maintain their competitive position. This study analyzes the impact of the heterogeneity of the educational background of the senior management team under the supervision of the board of directors on corporate R&D investment. Through an empirical analysis of listed companies in China from 2014 to 2018, it is found that the greater the heterogeneity of the educational background of the executive team, the higher the heterogeneity of the executive team’s educational background, the higher the level of communication costs of executives with different cognitions and values, which will reduce the efficiency of R&D decision making. The stronger the supervisory ability of the board of directors, the behavior of supervisory managers to abandon R&D investment in order to obtain short-term benefits, and increase the enterprise’s R&D activities and R&D investment. The stronger the supervisory ability of the board of directors, the more the board of directors has the right to intervene in the negative impact of the heterogeneity of the senior management team on corporate behavioral decisions-R&D investment. Therefore, companies should increase the number of highly educated managers, strengthen director supervision, and help senior managers make correct strategic decisions

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