Study On The Relationship Between TMT Characteristics And Business Performance Based On The Mediating Effect Of Investment Efficiency

Business investment is the main driving force and the important basis of enterprise development. The efficiency of investment behaviors directly affects the maximization of enterprise value, and hence has a significant impact on whether the enterprise can achieve sustainable development. For a long time, domestic and foreign scholars have successively made researches on investment behaviors and made a series of achievements in this regard. They have found that not all the investments are conducive to enterprise development. Therefore, how to enhance the efficiency of corporate investment has become the focus of scholars.Taking the state-owned holding companies listed in Shanghai Stock Market from 2011 to 2013 as the research objects, 571 listed companies were selected as the samples of this research. A frame analysis was made on the relationship between TMT characteristics, investment efficiency and business performance based on the introduction of managerial entrenchment theory. In this way, not only the influence of TMT background variables was studied, TMT incentive characteristics and constraint characteristics were also adopted as the independent variables and more control variables were introduced into the empirical test. The “characteristic-behavior-result” thinking mode was used to study how the TMT characteristics influence business performance. The path model was established and the investment efficiency was taken as the intervening variable in order to study the influence of TMT characteristics on business performance, and hence the conduction relationship of business performance. Bootstrap was used to verify the mediating effect of investment efficiency. The results showed that the investment efficiency exerted mediating effect between background characteristics and business performance and between incentive characteristics and the business performance. It didn’t have mediating effect between constraint characteristics and business performance. Further research revealed that the five indexes of TMT, namely the age, level of education, tenure, ratio of female and salary, influenced the investment efficiency, and hence, the business performance. While the shareholding ratio, the ratio of independent directors and the CEO duality had no influence on business performance. Finally, according to the results of empirical research, constructive suggestions on enhancing the business performance through reinforcing the TMT building and improving the corporate investment efficiency of the state-owned holding companies from the perspectives of personnel selection, incentive measures and constraint mechanism were proposed in this paper. At the same time, the shortcomings of this paper and the possible directions of future research were pinpointed.