Equity Pledge Of Major Shareholders,Quality Of Internal Control And Enterprise Innovation Investment

In recent years,in order to fundamentally improve the overall strength of the country,the Chinese government has actively promoted a large number of enterprises to improve their independent innovation capabilities.Since the 18 th CPC National Congress,General Secretary Xi Jinping has attached great importance to innovation and development,and proposed an innovation-driven development strategy.The 19 th CPC National Congress emphasized on building a strong country with science and technology.From the perspective of trade globalization,as a micro unit of innovation,continuous innovation is the key factor for building core competences and forming competitive advantages.Enterprises need sufficient funding to carry out innovative activities.In the case of limited financing channels,equity pledge,a new financing method with fast financing speed and low cost,has become one of the main financing channels for listed companies.However,if the majority shareholder's equity pledge cannot be repaid after the expiration of the pledge,it will face the risk of transfer of control rights,and the impact of the majority shareholder's equity pledge in order to avoid risks will have an impact on corporate innovation investment is an important research topic.At the same time,high-quality internal control of the enterprise can reduce the degree of information asymmetry,alleviate financing constraints,and to a certain extent can curb the interests of major shareholders,can the corporate internal control play the above role after the major shareholder's equity is pledged? By studying the relationship between major shareholder equity pledge,internal control quality and corporate innovation investment,this paper broadens the scope of research on the factors affecting innovation investment and the economic consequences of major shareholder equity pledge,and enriches the research on the impact of internal control on the behavior of major shareholders content.This article takes the equity pledge of major shareholders as the research entry point,and studies the equity pledge,internal control,and innovation investment of major shareholders based on the principal-agent theory,the signal transmission theory,the theory of control of private interests,the five elements of internal control theory,and the theory of technological innovation.Relationship.First,through the literature review and summary of the economic consequences of major shareholder equity pledges,and the impact of major shareholders and corporate internal control on innovation input,this paper proposes the innovations of this study,and puts forward two hypotheses to be studied based on what-if analysis.Then,we selected 2013-2018 data of A-share listed companies in Shanghai and Shenzhen,and constructed a multivariate regression model to empirically test the relationship between the equity pledge of major shareholders and the innovation investment of enterprises and the moderating effect of the quality of internal control on the two.The robustness test is carried out by replacing the method of measuring the explanatory variables,the method of replacing the explanatory variables,and changing the sample,and proves that the conclusions of this paper have certain robustness.Through research and analysis,this article draws the following conclusions: First,the equity pledge of major shareholders has a negative inhibitory effect on the innovation input of enterprises.Second,high internal control quality can alleviate the negative inhibitory effect of equity pledge by major shareholders on innovation input.The innovation of this article is based on the corporate innovation of the intermediate link that the pledge of equity affects the company's performance.Based on the perspective of internal control,the study of the weakening effect of the quality of internal control on the suppression of innovation investment by equity pledge of major shareholders is a deepening and expansion of existing research,Provides a new perspective for corporate governance research.In addition,the research conclusions of this paper are helpful for enterprises to regulate the behavior of major shareholders,strengthen the construction of internal control systems,and integrate internal control into all aspects of financing investment,which has certain reference significance for improving the ability of independent innovation of enterprises and promoting the development of innovation investment.