An Empirical Research On The Effect That Stockholders’ Characteristics On The R&D Intensity Of Listed Companies

With the aggravation of market competition and the acceleration of economicglobalization, the listed companies are having a deep understanding of the importanceof technical innovation for its survival and development. In an increasinglycompetitive new economic era which characterized by knowledge, technology andinformation, the company’s R&D activities have plyed a vital role in its survival anddevelopment.Successful R&D activities will enable the company to maintain andsharpen their competitive edge in the market and overall strength. As the company’sinvestment decision-makers, controlling shareholder has a causal link with the R&Dintensity of the company. After the equity division reform, the controlling shareholderis showing the new features. How these features will affect the R&D intensity? Thestudy researches characteristics of the controlling shareholders on the influence of theR&D strength after implementation of new accounting standards, to providetheoretical basis and empirical evidence for regulating the behaviors of controllingshareholders, reducing the private benefit of control of the controlling shareholders,promoting the sustainable healthy development of listed companies in China,enhancing its independent innovation capacity, thus enhancing China’s overallnational strength.In this paper, the impact of characteristics of controlling shareholder on R&Dintensity in Chinese listed companies is analyzed on the basis of the implementationof the new accounting standards. Using annual report data from2007to2010of thelisted company, the impact of six main features of controlling shareholder on the R&Dintensity is tested empirically. The empirical test shows the following results: thenature of the shares has negative relationship with R&D intensity, ownershipconcentration and equity balance degree have positive relationship with R&Dintensity; Two rights separation degree has a positive correlation relationship withR&D intensity, the relationship with other shareholders and the nature of the Groupcontrol have negative impact on the R&D intensity, but all these results did not passthe test of significance, because of the subjectivity of data collection and theuncompleted share structure split reform in China. Finally, putting together thetheoretical analysis and empirical conclusions, we make mandatory disclosure oflisted companies R&D expenditures, develop and grow institutional investors, changethe dominance to multi-strand, strengthen the construction of the control market andso on, so as to improve the R&D intensity in China’s listed companies.