The Influence Of Top Team Management Characteristics On Firm Performance

After Hambrick and Mason put forward the theory of "Upper Echolons", it has become popular for foreign scholars to study the relationship between the demographic characteristics of top management team and corporate performance. China is now facing a economic turning point, and the private economy is playing an very important role in national economy, meanwhile, Machinery and equipment manufacturing industry is an important foundation for industrial system. This paper will focus on:how will the performance of private economy be effected by its Top Management Team(TMT)?Based on China’s machinery, equipment, instrument manufacturing private empirical data of173listed companies, this paper discusses the influence of TMT’s structure features on enterprise performance, including TMT population characteristics in the following dimensions:gender, political relationship with the government, age, education level, professional and functional background-both the overall statistical characteristics and heterogeneity.173listed private corporations classified as machinery, equipment, instrument manufacturing industry has been selected and sifted from CSMAR database, and the study period is from2012to2013. An econometrics model has been established, containing three control variable of corporate scale, team scale and ownership concentration, eight independent variable-ratio of female member, political relationship, academic experience, average age, average education level, and three independent variable measuring TMT’s age/education/function background heterogeneity. Through multiple liner regression analysis, some meaningful conclusions are drawn.Empirical analysis found that team scale, average education level of TMT members, the heterogeneity of TMT functional background has a significant positive effect on corporate performance; the political relationship and academic experience of TMT and heterogeneity of TMT’s age has a weak positive effect, but not at a significant level. While the average age of TMT members and heterogeneity of TMT education level has a significant negative effect on corporate performance; the ratio of female members has a weak effect, but not at a significant level.In addition, we use the standardized regression coefficients (weighted Beta) of the variables to value the relative importance on firm performance. We found that in terms of relative importance, functional background heterogeneity ranked1st, the average level of education2nd, and team size3rd; and the relative importance of the overall heterogeneity variables are higher than non-heterogeneity variables.In the last part of this paper, proposals are put forward based on empirical results. The deficiencies of this study and the prospect of further research are also discussed.