Chairman's Tenure Of Office,Management Freedom And R&D Investment

R&D investment,as a key way for modern enterprises to enhance their independent innovation ability,maintain and improve their core competitiveness,has attracted high attention from the business community and academia.In recent years,with the rise of the high-echelon team theory,scholars at home and abroad have gradually begun to explore how the demographic characteristics of managers affect the R&D investment of enterprises.Chairman of the board of directors as the legal representative and final decision maker of the company,the tenure as one of the important population background of the managers,the chairman's term is likely to affect the R&D investment.However,there are not many studies on chairmen,nor on executive tenure,nor on chairman's tenure.In addition,by digging into the theoretical root of management freedom,we found that management freedom is an important boundary condition and situational factor influencing R&D investment.Therefore,this paper focuses on the relationship between chairman's tenure and R&D investment,and it is of great theoretical and practical value to introduce chairman's tenure and management freedom into the research framework of R&D investment.This paper selected the non-balanced panel data of a-share listed companies in Shanghai and Shenzhen from 2010 to 2016.In the analysis framework of the principal-agent theory,the relationship between chairman tenure and enterprise R&D investment was discussed.According to the enterprise contract theory and strategic management theory,the moderating effect of management freedom on the relationship between chairman tenure and R&D investment was introduced.Empirical studies on SPSS 19.0 and Stata12.0 showed that:the relationship between the Chairman's term of office and the R&D investment of the company was inverted U-shaped,and the relationship between the reserved term of the chairman and the R&D investment of the company was not significant.The degree of freedom of management played a regulatory role in the relationship between the chairman's existing term and R&D investment.In the high degree of management freedom,that is,in enterprises or young enterprises or small enterprises or enterprises with high market competition,the tenure of the chairman is more significantly related to R&D investment.In the high market competition environment,the reserved tenure of chairman is significantly negatively correlated with R&D investment,while the relationship is not significant in the low market competition.The conclusion of this study showed that there are some problems in the presidency arrangement of the listed companies in China.For example,the chairman's reserved term of office has no obvious relationship with the R&D investment.In addition to the industry environment,the regulation effect of management freedom on chairman's term of office and R&D investment is not significant.This paper is helpful to understand the motivation of enterprise R&D decision from the perspective of chairman's term of office,and also help to understand the influence mechanism of management freedom on chairman's R&D decision.Most importantly,this paper,based on the empirical results,combined with the management practice of Listed Companies in China,put forward the corresponding countermeasures and suggestions for listed companies in China:First,reasonably arrange the term of chairman of the board of directors,for example,select or appoint a chairman who is conducive to the development of the enterprise,the term of the chairman should neither be too short nor too long,the term of office of the chairman shall be extended at least not less than two terms,establish an effective mechanism of the chairman to appoint or remove,improve and perfect the chairman's incentive and restraint mechanism;Secondly,pay attention to the coordination of management freedom;Third,standardize the disclosure system of R&D information.