Institutional investor stability, executive equity incentives, and corporate innovation

Haoyi Jia and Weina Che

Finance Research Letters, 2025, vol. 83, issue C

Abstract: This study utilizes financial data from listed companies between 2013 and 2022 to examine the relationship between institutional investor stability and corporate innovation. The results indicate that institutional investor stability enhances corporate innovation levels. This positive effect exhibits heterogeneity across firms with varying levels of managerial control and different scales. Furthermore, institutional investor stability promotes corporate innovation by increasing executive equity incentives, while the increase in agency costs weakens the positive effect of institutional investor stability on corporate innovation.

Keywords: Institutional investor stability; Executive equity incentives; Agency costs; Corporate innovation (search for similar items in EconPapers)
JEL-codes: G32 G34 L25 M52 O31 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:83:y:2025:i:c:s154461232500950x

DOI: 10.1016/j.frl.2025.107691

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