Organizational Behavior and Human Resource Management Top Management Team Heterogeneity, Faultlines and Corporate Risk-taking

Abstract

Abstract:

This paper takes A share listed companies in 2011-2017 as the research object. By applying the theories of TMT heterogeneity and Group faultlines, we probe into the relationship among TMT heterogeneity, faultlines and risk-taking, as well as the moderating role of CEO power and compensation incentive in the relationship between faultlines and risk-taking. The results show that the age heterogeneity, education degree heterogeneity, functional background heterogeneity and social capital heterogeneity have significant negative correlation with enterprise risk-taking respectively. And there is a significant positive correlation between the faultlines of TMT and enterprise risk-taking. The mechanism of the group faultlines is more explanatory than the team heterogeneity. What's more, this paper verifies the moderating effect of CEO power and compensation incentive on the "group faultlines-risk taking" relationship, and the regulating effect of equity incentive is better than monetary compensation incentive. Companies need to reasonably arrange the structure of the TMT and match the corresponding CEO power and salary incentive system to meet different risk-taking requirements.

Key words: TMT heterogeneity, group faultlines, risk-taking, CEO power, compensation incentive

Sun Yuefan, Chen Shuang, Zhang Yongji. Organizational Behavior and Human Resource Management Top Management Team Heterogeneity, Faultlines and Corporate Risk-taking[J]. , 2019, 31(8): 157-168.

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