| The 2018 Central Economic Work Conference stressed that we should "vigorously cultivate new momentum,strengthen technological innovation,promote new progress in major technological innovation,and promote mass entrepreneurship and innovation to a higher level".Thus,innovation is the key strategy for China’s economic growth and companies to maintain competitive advantage.Innovation is a long-term process full of uncertainties and high risks.To motivate innovation,we need to have a certain tolerance of failure in the short term,and use a long-term perspective to evaluate the future cash flow feedback of the project.In the capital market,the threat of control transfer is an unavoidable problem for companies.Therefore,managers may take the initiative to cater to the short-sighted behavior of market investors(such as reducing R&D investment,manipulating profits to boost short-term stock prices).As an effective corporate governance mechanism,the Anti-takeover clauses set forth in the company’s charter can overcome the above disadvantages and help management focus on long-term innovative activities with higher value.But there are also some foreign documents that show that anti-takeover clauses can also stimulate large shareholders’ short-term behavior such as tunneling,laziness and so on,thus restraining corporate innovation.At present,there is no consensus on which effect is dominant;the research based on the Chinese situation is very rare.With the perfection of the capital market system in China,the Anti-takeover awareness of listed companies has become stronger and stronger.There are more and more anti-takeover clauses in the articles of association.The most typical one is the wave of anti-takeover clauses set up after the "Baowan dispute" in 2015.Therefore,it is an important supplement to the existing literature research to answer the impact of anti-takeover clauses at the corporate level on the company’s innovation activities and the specific internal mechanism.It is also very suitable for the current situation of China’s capital market development and the urgent needs of economic transformation and upgrading.In this study,text analysis and manual sorting are used to identify the articles in the articles of association.With golden parachute plan,staggered board clause and absolute majority clause as the core,the most typical anti-takeover clause system is constructed,and the relationship between anti-takeover clause and corporate innovation activities is tested based on the panel data of A-share listed companies from 2005 to 2017.This study focuses on four issues: Does the Anti-takeover clause set by the Charter better motivate company innovation? What is its internal mechanism? Which companies will adopt anti-takeover clauses to help companies innovate and develop? What is the moderating effect of regional institutional environment in China? The empirical analysis of this study has the following main findings:Firstly,from the perspective of the relationship between "anti-takeover clause-Corporate innovation",the establishment of anti-takeover clause will significantly improve the level of innovation output of the company,and present a long-term stable relationship.This impact is highly consistent in both substantive innovation output and non-substantive innovation output.These relationships remain robust after using PSM-DID and regression of instrumental variables.Further tests show that among the groups with high degree of information asymmetry,industry market competition and economic uncertainty,anti-takeover clauses play a more prominent role in promoting innovation output.This is because the Anti-takeover clause can provide guarantee and incentive for the company’s technological innovation activities in a harsh environment.In addition,anti-takeover clauses play a good role in promoting innovation activities in innovation-intensive industries,decentralized ownership,high equity checks and balances,and companies with low proportion of state-owned enterprises and institutions.Secondly,as far as the mechanism of "anti-takeover clause-company innovation" is concerned,first of all,there is no evidence that the Anti-takeover clause of the charter is significantly positively related to the tunneling behavior of large shareholders.The anti-takeover clause set by the company does not reduce the motivation of large shareholders to actively supervise managers.It embodies more the protection of the chairman,and the performance-turnover sensitivity of the two clauses.This shows that the Anti-takeover clause does not aggravate the problem of insider control in China,so the Anti-takeover clause has no obvious inhibitory effect on innovation activities.Secondly,in safeguarding the rights and interests of stakeholders,the Anti-takeover clause of the articles of association protects the board of directors with higher capabilities,alleviates the financial constraints of the company,and is more willing to disclose corporate social responsibility,which provides the guarantee of knowledge gathering and financing channel expansion for the company’s innovation activities,and then promotes the company’s innovation.Finally,in alleviating managerial shortsightedness,anti-takeover clauses will be more willing to adopt monetary incentive incentives,less inclined to manipulate real earnings management,so as to encourage managers to participate more actively in innovation activities,thereby improving the company’s innovation output.Thirdly,in terms of the regulation of "institutional environment on the relationship between anti-takeover clauses and corporate innovation",when a company is located in a high market-oriented area,the role of anti-takeover clauses in promoting corporate innovation activities is strengthened;when a company is located in a low degree of government intervention,the role of anti-takeover clauses in promoting corporate innovation activities is strengthened;and when a company is located in a high degree of social trust.In regions with high risk preference,the promotion of anti-takeover clauses on corporate innovation activities is also enhanced;in regions with high risk preference,the promotion of anti-takeover clauses on corporate innovation activities is also enhanced;in areas with high innovation culture,the Anti-takeover clauses have a significant promotion effect on corporate innovation activities,and are located in areas with low innovation culture atmosphere.In regional time,anti-takeover clauses even show significant inhibition in the company’s substantive innovation activities.The possible innovations of this study are as follows: 1)From the perspective of corporate innovation,it expands the literature on the governance effect of anti-takeover clauses at the corporate level,and extends the research scope of "law and finance".On the one hand,there are few studies on the impact of anti-takeover clauses on corporate innovation,and Chinese studies on this topic have not been explored;on the other hand,foreign literature draws a conclusion that anti-takeover clauses promote the overall effect of improving corporate innovation level,but lacks the discussion on its specific internal mechanism and the disturbance of anti-takeover clause restraint effect on the overall effect;on the other hand,anti-takeover clauses disturb the overall effect of anti-takeover clauses.The relationship between acquisition clauses and corporate innovation is influenced by the regional institutional environment more significantly than that in European and American countries.Therefore,this study has a certain breakthrough significance in the research of the relationship between anti-takeover clauses and corporate innovation in China’s corporate charter.2)Using text analysis and manual collation,we can construct a systematic index of anti-takeover clauses in the Charter of Chinese listed companies,provide empirical evidence of the impact of anti-takeover clauses on innovation at the corporate level in the context of China,and give an answer to the boundary of such impact.3)This study uses a variety of methods to deal with possible internal problems,making the empirical conclusions more objective and robust.The conclusion of this study is helpful to deepen the understanding of the conditions under which the Anti-takeover clauses of the articles of association of our country are conducive to the improvement of the company’s innovation.It is also important for the regulatory authorities to guide the listed companies to set up anti-takeover clauses reasonably and for the regulation of companies with anti-takeover clauses of the articles of association to help the company’s innovation and development.It is also important for the practice of anti-take The reference value. |
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