TMT,Governance Structure And Corporate Strategy Diversity

Diversification of enterprise strategy is a dominant strategic action that seriously affects the performance of enterprises and the welfare of shareholders.In order to adapt to the growth of the spontaneous formation of management tendency,diversification strategy is usuallyused to develop market opportunities in different sectors of the enterprises,while strategic diversification also increases the diversification of the business environment and the value chain complexity,so as to affect the enterprise performance.Over the last several decades,strategy researchers have devoted considerable attention to the question of how corporate elites affect corporate strategy.Many of these researches have been grounded in two dominant theoretical perspectives:upper echelons and agency theory.Both perspectives agree that corporate elites' preferences and dispositions do have some influence on corporate strategy,while the upper echelons theory emphasizes the effect of personnel characteristics,preferences and tendencies,the agency theory emphasizes the role of position-based preferences and dispositions.Considering the theory of the two aspects,this article claims that executives make strategy decisions based on their population characteristic preferences and tendencies,and at the same time their position in the corporate governance structure will regulate the effect of executive strategic decision.This paper firstly summarize relevant theoretical basis,including decision theory and upper echelons theory;principal-agent theory;and resource based theory and core competence theory.Basing on these theories,this article sorts out relevant literature,summarized the relationship between top management team and corporate strategic decision-making.Through literature review,found that the effect of TMT on enterprise's strategic decision has not formed a consistent conclusion,this paper further detailed research on the situation,concerned about the impact of TMT heterogeneity and enterprise strategy diversity,and concerned about the regulation of executive governance status.Using the data of 1010 Chinese A-share listed companies from 2013 to 2015 as sample;this article empirically studied the impact of TMT heterogeneity on corporate strategic diversity and then tested the moderating effect of governance structure.The results show that TMT gender heterogeneity and tenure heterogeneity have positive effects on strategy diversification;TMT age and functional heterogeneity have negative effects on strategy diversification;TMT government background and financial background heterogeneity has no significant effect on strategy diversification.Managerial ownership has negative regulation effect on the relationship between TMT heterogeneity and strategic diversity,while CEO duality has no significant moderating effect.