The Effect Research Of Mediating Variable On The Relationship Between Institutional Investors And Corporate Performance

Institutional investors first appeared in the West, continue to grow and develop in the capital market of Western developed countries, and have played an increasingly important role. After the reform and opening up more than 30 years in China, it creates a positive environment to attract foreign investments. Institutional investors in China’s stock market are from scratch to the rapid development, and eventually become the largest shareholder.This study is primarily aimed at institutional investors having an impact on corporate R&D behavior, institutional investors having an impact on corporate performance and R&D behavior having an impact on corporate performance. On this basis, whether innovative strategy plays a mediating effect between institutional investors and corporate performance? What is more, we divide institutional investors into fund companies and others and study mediating effect relationship between corporate performance and R&D behavior in the paper.This paper selects non-balanced panel data of the Shanghai and Shenzhen stock 2011,2012,2013 three-year manufacturing and IT industry, including 577 companies.First, the study indicates that the relationship between R&D behavior and all the institutional investors is a weak inverted U-shaped function. R&D behavior has an negative impact on corporate performance. There is not a significant relationship between all the institutional investors and corporate performance. R&D behavior plays a fully mediating effect on the relationship between all the institutional investors and corporate performance.Second, There is not a significant functional relationship between the fund company and innovative strategy. R&D behavior has an negative impact on corporate performance. The fund company has an active impact on corporate performance. Innovative strategy does not play a mediating effect on the relationship between the fund company and corporate performance.Third, The relationship between R&D behavior and other institutional investors is a significant inverted U-shaped function. R&D behavior has an negative impact on corporate performance. The relationship between corporate performance and other institutional investors is a significant U-shaped function. R&D behavior plays a part of mediating effect on the relationship between other institutional investors and corporate performance.For the above conclusions, we propose countermeasures and suggestions of introducing institutional investors and R&D problems that need attention.The innovations of this paper are:First, establish a "from institutional investors to mediating variables (R&D behavior), to corporate performance" theoretical framework and models. R&D acting as a mediating variable in the first time, We empirically study the relationship between other institutional investors and corporate performance in which R&D is to play a mediating effect. R&D acting as a mediating variable avoids purely study the relationship of institutional ownership and corporate performance. Second, we divide institutional investors into fund companies and others in the first time and study mediating effect relationship between corporate performance and R&D behavior in the paper. It makes up the current domestic institutional investors only studying empirical research issues related to the overall institutional investors. Third, when selecting a measure of corporate performance, select relative to the industry average rate of return on assets (AROA), avoiding the impact of the industry on the company’s performance.