THE IMPACT OF BOARD COMPOSITION AND OWNERSHIP STRUCTURE ON INNOVATION PERFORMANCE: AN EMPIRICAL STUDY IN TAIWAN’S ELECTRONICS INDUSTRY

Hsiang-Tsai Chiang, Cheng-Chun Chao and Tzu-Yu Ou

The International Journal of Business and Finance Research, 2023, vol. 17, issue 1, 13-34

Abstract: This research measures innovation performance from the perspective of R&D investment and patent rights and explores the impact of different board compositions and shareholding structures on corporate innovation performance. This study goes on to discuss whether the composition of the board of directors can be balanced with the shareholding structure, which will have a different impact on the company’s innovation performance. The sample used in this study is a sample of Taiwan’s listed OTC electronics industry for a total of five years from 2014 to 2018. The innovation value chain is used to measure the company’s innovation performance, from “input (R&D expenditure) → intermediate output (patent rights) → final output (Sales) “conducted an empirical analysis. The results show that the composition of the board of directors and the shareholding structure have inconsistent effects on the company’s innovation value chain, which may be beneficial to investment in research and development but not conducive to the final output (sales). External and independent directors can increase the independence of the board of directors, and can adjust the ratio of shareholding and deviation of control rights and cash flow rights of directors and supervisors, which will have a positive impact on innovation performance.

Keywords: Board Composition; Ownership Structure; Board Independence; Innovation Performance (search for similar items in EconPapers)
JEL-codes: C12 G30 M41 (search for similar items in EconPapers)
Date: 2023
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Citations: View citations in EconPapers (1)

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