Check-and-balance Ownership,Financial Performance And R & D Investment

Since the non-tradable share reform,the shareholding structure of listed companies in China has been gradually optimized.But some negative issues are still common,including that the controlling shareholders infringe the legitimate rights and interests of minority shareholders,tunnel the company's interests for their own benefit and so on.In order to effectively control the illegal behavior of the controlling shareholder,it is even more important to play the role of other major shareholders in checking and balancing the controlling shareholder.In addition,according to national statistics,Chinese R&D expenditure intensity reached 2.13% in 2017.But compared with developed countries,the overall level of R&D investment is large but not strong and not excellent,which shows that the development status is still grim.In the context of deepening the reform of the science and technology system and the diversification of the shareholding structure in China,it is crucial to explore the relationship between check-and-balance ownership and R&D investment.At the same time,in view of the fact that sufficient financial resources reserves of enterprises are beneficial to promote R&D investment and check-and-balance of stock ownership has affected financial performance to a certain extent,exploring the relationship among check-and-balance ownership,financial performance and R&D investment is of great significance for China to transform from extensive economy to knowledge-intensive economy.At the same time,exploring the specific application of different check-and-balance ownership structure in distinctive system background of China has practical guiding significance for enterprise development.So what is the relationship among check-and-balance ownership,financial performance and R&D investment? What is the relevant influence factor and action path? In order to explore these issues,this paper takes Chinese A share listed companies of the manufacturing industry from 2010 to 2017 as samples and studies the influence among check-and-balance ownership,financial performance and R&D investment as well as the relevant influence factor and action path.After empirical test and analysis,for the listed companies in Chinese manufacturing industry,the results show that: 1)Check-and-balance ownership are positively affecting the financial performance and R&D investment of the enterprise.The check-and-balance ownership of strong financial performance of the enterprise is more conducive to promote research and development investment.It shows that the major check-and-balances shareholders can promote the R&D development of enterprise by increasing the possibility offinancial resources for R&D investment and providing decision-making resources for R&D project selection.2)Among the three check-and-balance ownership structures,the 2-5 major shareholders have the strongest positive effect on financial performance and R&D investment,among which the dominant shareholder is the second largest shareholder.3)By further studying the check-and-balance ownership of second largest shareholder it can know that:(1)Compared with state-owned enterprises,non-state-owned enterprises are more prominent in the positive relationship between check-and-balance ownership and R&D investment,but they are not as good as state-owned enterprises in the positive effect of check-and-balance ownership and financial performance.(2)Compared with the 2014-2017 stage,the check-and-balance ownership of non-state-owned enterprises in 2010-2013 is more positively related to R&D investment;but for the state-owned enterprises,the positive correlation between the check-and-balance ownership and the financial performance in 2010-2013 is even more strong.(3)Certain factors of financial performance(such as operating cash flow,asset-liability ratio)play a mediating role in the positive relationship between the check-and-balance ownership and R&D investment,which means that the check-and-balance ownership of second largest shareholder mainly promote R&D investment by increasing operating cash flow and reducing liabilities.Based on the above empirical results,this paper puts forward relevant suggestions for improving the policy of check-and-balance ownership governance mechanism in China,with a view to enhancing check-and-balance ownership governance mechanism for promoting the development of Chinese manufacturing enterprises and national economic development.