Research on Top Management Team Trait and Firm Performance

Abstract

As the strategic decision-makers of the enterprise, top management team has a profound impact on the efficiency of R&D investment of the enterprise, and even decides whether the enterprise makes plans and decisions on investment. This research focuses on the relationship between the demographic characteristics, cognition level of executives and enterprise investment has become the key to affecting enterprise development.This paper builds a research theoretical framework based on high-level ladder theory, selects Shanghai and Shenzhen A-share listed companies from 2010 to 2019 as the research object, uses multiple linear regression as the main research method to examine the impact of top management team characteristics on firm performance.The study found that the age, education level, tenure of the top management team were significantly positively correlated with firm performance, but the level of stock ownership of the top management team had no correlation with firm performance. Second, the stock ownership level of top management team members has a negative moderating effect on firm performance. The reason for this result is the time lag effect of equity incentives and the management risk aversion effect caused by executive stock ownership. Third, after distinguishing property rights, the stock ownership level of the top management team in state-owned enterprises and non-state-owned enterprises does not have a moderating effect on firm performance.