Research On The Correlation Of Institutional Investors And Research And Development Of Listed Companies

With the rise of the stake of institutional investors, the relaxation of governmentcontrol and actively promoting, the institutional investors of the United States, Britainand other western countries have gradually given up the past and passive means of“vote with their feet”, beginning to use the positive mode of “voting with the hand”.The rising of shareholder activism of institutional investors attracts the attention ofscholars at home and abroad. In addition, the research and development activities arenot only the impetus of enterprise survival and development, but also an importantfactor for investors to predict the prospects of business development. Therefore, theR&D input will become a topic of concern to institutional investors.Based on Institutional shareholder activism theory and principal-agent theory,this thesis explores the institutional investors to exercise positive power. Furthermore,this thesis studies the necessity of influence of institutional investors to R&D inputfrom two aspects of the cause and the mode of action. Finally, it probes into therelationship between institutional investors and R&D input of listed companies. In theempirical test part, the thesis chooses the2007-2010of China’s domestic A-sharelisted companies which was injected by institutional investors as a sample. Then,using the holding ratio of overall institutional investors, the holding ratio of differenttypes of institutional investors and R&D intensity as explanatory variables, weexamines the relationship between institutional investors and R&D of listedcompanies. The study shows that China’s institutional investors can urge listedcompanies to increase R&D input, while different types of institutional investors varyin their influence to R&D input of listed companies. In addition, the listed companiesto increase R&D input will attract some institutional investors to increase their stake.This indicates that the development of institutional investors in China is not yetbalanced, which need to continue reform and improve.Finally, according to the findings, this thesis gives some advices:(1)Develop theinstitution investors vigorously and optimize the structure of institutional investors;(2)Relax appropriately or remove related laws and regulations of institutional investorsto participate in corporate governance;(3)Increase R&D input of listed companies andmake a win-win situation between listed companies and institutional investors.