The Banking Background Of Directors、Financial Constraints And The Companies’ R&D

Innovation is the key to helping enterprises break the bottleneck, look for new profit growth point and expand the existing market share. Enterprises need a lot of money to invest on R&D. And the acquisition of external funding is important to R&D. However, poor financial market development, imperfect legal system and asymmetric information make it difficult for enterprises to finance. How to improve the financing environment, smooth financing channels, reduce the fund raise pressure and promote enterprise innovation have increasingly become the research focus. Strengthen the relationship between company and bank, alleviate financing constraints, smooth financing channels, increase enterprise funds and promote enterprise innovation are urgent problems which needed to solve.In this paper, the main line is the relationship among the banking background of directors, financing constraints and enterprises’ R&D. It also adds the following factors: company size, the nature of ownership and financial marketization, to investigate the differences under different circumstances. The data selected from A-share listed companies between 2006 and 2014. The siftings have brought 9574 valid samples. Through the empirical analysis, the conclusions of this paper include the following aspects:(1)The banking background of directors can ease companies’ financing constraints;(2)Companies’ financing constraints would inhibit companies’ R&D;(3)The banking background of directors can promote companies’ R&D through easing companies’ financing constraints. The influence on promoting companies’ R&D by hiring directors with banking background is more significant for high financing constraints companies than low financing constraints companies. Further analysis yields more conclusions: The influence on promoting companies’ R&D by hiring directors with banking background is more significant for small-size companies, non-state-owned companies and companies in the region with lower degree of financial marketization.This thesis further put forward some suggestions on how to ease financing constraints and promote companies’ R&D. For the government, it should reform the judicial system, develop the financial market deeply, enhance the level of financial development and support a good environment for companies’ innovation; for enterprises, they should strengthen corporate governance and risk control, improve core competence, pay more attention to the reputation while establishing long-term relationship with banks and seek methods to ease financing constraints to obtain funds to meet the needs of companies’ research and development.