Research On The Impact Of Dual-class Share On Innovation Performance Of Science And Technology Enterprises

Science and technology enterprises grow rapidly in the background of innovation-driven development strategy put forward by the state.Innovation is the source of its vitality,and capital is the guarantee to maintain the normal operation of all departments.In the process of financing mergers and acquisitions,technology enterprises choose dual-class share structure,and the founders have one share and multiple votes.They do not need to worry too much about malicious mergers and acquisitions,and control the voting rights and innovation initiative in their own hands,so as to improve financing efficiency,realize self-reliance and self-improvement,and promote the development of enterprises to a higher level.As CEO,the founder considers the long-term development of the enterprise and has a long-term vision,focusing on increasing R&D investment,creating innovative solutions and improving innovation performance.Previously,companies such as JD and Vipshop gave up listing in China and turned to foreign dual-class shares.In order to reduce the loss of high-quality domestic enterprises,prevent foreign companies from malicious mergers and acquisitions of local enterprises and enrich the investment methods in the capital market,The Hong Kong Stock Exchange allowed dual-class share structure listing in 2018.Xiaomi was the first dual-share listed technology company after this policy was issued,making it the third largest technology stock in the world at that time.As a technology-based enterprise,Xiaomi always pays attention to improving its innovation performance.This paper takes Xiaomi As an example to study the impact of dual-class share listing on innovation performance.First of all,by combining theory with practice,it is proposed that dual-class share structure can enable founders to hold the voting rights tightly.Founders pay attention to the interests of both shareholders and managers,so that they can make decisions that are more in line with the long-term development of the company and balance the relationship between stakeholders.Signals to outside investors that Xiaomi is confident its founders will have more voting rights in the future.At the same time,the excess voting rights enable Xiaomi to ensure that the control right is not easily transferred in the process of financing merger and acquisition,avoiding malicious merger and acquisition.But dual-class shares also impose agency costs,as founders’ actions are amplified and affect a company’s stock price.From the perspective of R&D investment and fan economy,this paper compares and selects the changes before and after the dual-class share listing of Xiaomi,and analyzes and evaluates the innovation performance of the corresponding path output by using four indicators,namely the number of patent output,trademark right,xiaomi’s mobile phone shipments and return on equity.Through the case analysis and study of Xiaomi,it is concluded that dual-class equity is a double-edged sword.On the one hand,dual-class share equity can enrich investment methods,expand financing channels and maintain the stability of corporate control.Founder,on the other hand,may lead to lack of ability to make bad decisions,agent cost and stock price volatility.It can also be concluded that science and technology enterprises can increase R&D investment and develop fan economy to improve innovation performance.Combined with domestic and foreign literature and the case study of Xiaomi,this paper puts forward suggestions on dual-class share ownership system and innovation performance of science and technology enterprises in China,including:increasing the publicity of dual-class share ownership,so that more enterprises have the opportunity to contact and understand dual share structure;Properly choose the way of listing,keep a good management mode and learn from high-quality enterprises,not blindly follow;It is suggested that the founders improve their personal quality,take due responsibilities and bring greater harvest to the company.Finally,it provides a case reference for the listed technology companies to choose the equity structure,and provides a certain basis for them to improve the selection path of innovation performance.