Are better-governed firms more innovative? Evidence from Korea

Paul Moon Sub Choi, Chune Young Chung, Xuan Vinh Vo and Kainan Wang

International Review of Economics & Finance, 2020, vol. 69, issue C, 263-279

Abstract: This study examines the effect of corporate governance quality on firm innovation in Korea, where innovation is very active. We focus on the relationship between a firm’s corporate governance score (CGS) and its innovation performance in various empirical settings using manually collected patent data. We find that CGS positively influences firm’s innovation activity, which is driven by board’s quality and transparent disclosure. This relationship is more evident in chaebol-affiliated firms, suggesting that sound corporate governance is effective in promoting innovation activities when the misalignment between managers’ and other stakeholders’ interests is grave.

Keywords: Corporate governance; Firm innovation; Patent; Chaebol; Emerging market (search for similar items in EconPapers)
JEL-codes: F21 G32 G34 O31 O32 O33 (search for similar items in EconPapers)
Date: 2020
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:69:y:2020:i:c:p:263-279

DOI: 10.1016/j.iref.2020.05.018

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