Does the paternalism of founder-managers improve firm innovation? Evidence from Chinese non-state-owned listed firms

Lan Sun, Shaobo Liu and Peng Chen

Finance Research Letters, 2022, vol. 49, issue C

Abstract: This paper investigates the impact of firm founders as top managers (founder-managers) on firm innovation. We first propose a text-based indicator of founder-manager paternalism to measure the emotional relationship between founder-managers and the firms they founded from the perspective of socioemotional wealth. We further investigate the role of founder-manager paternalism in firm innovation using a sample of non-state-owned listed firms in China during the period 2007-2017. The results show that founder-manager paternalism has a positive impact on firm innovation. Moreover, the findings indicate that higher levels of corporate governance may undermine the positive relationship between founder-manager paternalism and firm innovation.

Keywords: Paternalism; Firm innovation; Firm founder; Governance; Textual analysis (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:49:y:2022:i:c:s1544612322003695

DOI: 10.1016/j.frl.2022.103146

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