Multiple Institutional Logic,Board Characteristics And Mergers And Acquisitions

The concept of institutional logic originated in the new institutional theory in sociological research.One of the basic assumptions is that different institutional logic leads to different decisions and behaviors.The institutional logic theory that has emerged in recent years holds that the decision-making power of policymakers is influenced by the institutional logic that they accept.Logic is the hypothesis and value that society shares and is deeply embedded in people's minds.It will form a fixed cognitive framework and a standard to measure the legitimacy of the subject.Therefore,institutional logic shapes or determines the "rules of the game" in the context of the organization and the series of assumptions people see about things.In the context of the long-term coexistence of domestic government's dominant logic and market logic in China's economic transition period,as an important strategic decision of an enterprise,corporate mergers and acquisitions will inevitably be affected by the logic of this competitive system.However,as a hot topic in related academic fields,the mechanism of the influence of multiple institutional logic remains controversial.In this context,we selects the M&A events of the Shanghai and Shenzhen A-share listed companies from 2009 to 2016 as research samples.Based on institutional logic,decision theory,corporate governance,and other perspectives;this paper combines the theory of institutional logic,corporate governance theory,and other related theories;and this paper also adopt literature research methods,Empirical research methods,event research methods,and other research methods.The empirical test examines the relationship between the logic of multiple institutions and the frequency of corporate mergers and acquisitions,and the response of investors to announcements issued by companies under the logic of different institutions,and further analyzes the regulatory role of board characteristics.To predict how the company's external influences(through ownership)and internal influences(through the joint decision of the board of directors)influence the merger and acquisition of the company.Based on the inspection results,we have put forward relevant recommendations from the institutional,corporate and investor levels.The research conclusions obtained through empirical analysis in this paper show that the multiple institutional logic will affect corporate mergers and acquisitions.The specific performance is as follows: 1.External advocates of government-led logic(proportion of state-owned shares),internal supporters(proportion of directors with political experience)will inhibit the frequency of mergers and acquisitions of marketization of enterprises;2.External power alliances of market logic(proportion of legal-person shares),internal The strategic alliance(shareholding ratio of the board of directors)will increase the frequency of mergers and acquisitions in the market.3.under the logic of multiple systems,a higher proportion of state-owned shares will reduce the cumulative abnormal return(CAR)after mergers and acquisitions.In further research,it was found that the shareholding ratio of the board of directors strengthened the influence of market logic on corporate mergers and acquisitions,and weakened the influence of government-led logic on corporate mergers and acquisitions.In other words,during the period of China's economic transition,The government's dominant logic and market logic are competitive and coexist in the company's internal.These logics create alliances that affect the company's acquisition decisions through each logical advocate,and these alliances are reflected in the sources of external ownership of ownership and the internal sources of power represented by the board of directors.This study helps to find the mechanism of multiple institutional logic for corporate mergers and acquisitions,and it is of great theoretical and practical significance to answer the influence of the logic of the Chinese enterprise system in the economic transition period and the characteristics of the board of directors on the merger and acquisition behavior of the company.