A Research of the Regulating Role of CEO Power over the Internal Mechanism of Board of Director's Influence on Corporate Innovation

Abstract

Abstract:

Through establishing incentives, human capital and social capital of board members can be encouraged and directly affect board decisions, resource management and so on. Also CEO is responsible for the resource allocation and strategic decision of the company, and the interaction between strong CEO and the board of directors may have a significant impact on the quality of the company's strategic decision. The interaction between CEO power and board capital may cause different resource supply modes and then affect R&D investment decisions, so CEO power must be considered when evaluating the impact of board capital on corporate innovation. The existing studies focus only on the relationship between board capital and corporate innovation, but ignore the interaction between CEO power and board capital. This paper uses a resource-based theory to study the internal mechanism of the board of directors' influence on capital R&D investment, and further explore the CEO power effects on the relationship between the board capital and company innovation. The study finds that board's human capital and social capital have a significant impact on corporate innovation and CEO power has a regulating function. The above studies supplement and improve the resource dependence theory, and provide a more comprehensive understanding of the relationship between board capital and corporate innovation.

Key words: board capital, corporate innovation, CEO power

Zhang Weijin, Li Kai, Wang Shumei. A Research of the Regulating Role of CEO Power over the Internal Mechanism of Board of Director's Influence on Corporate Innovation[J]. , 2018, 30(4): 70-82.

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