Management Turnover Risk,D&O Liability Insurance And Business R&D Investment Efficiency

With the continuous advancement of innovative country creation and innovation-driven development strategies,innovation has become the main driving force for China's economic development.Enhancing the innovation capability and the the efficiency of enterprises are important means to enhance the core competitiveness of enterprises.It is also the only way for China's economic development in the new era.Existing related studies show that macroeconomic factors such as monetary policy,tax preferences,government subsidies,corporate governance factors such as financing constraints,agency costs,executive incentives,and individual characteristics of managers such as gender,age,educational background and professional background will affect the efficiency of R&D investment in modern corporate governance framework.Under the framework of modern corporate governance,managers are employed by companies and supervised by shareholders.The shareholders can turned over according to the results of the assessment.As a kind of human capital,management has a strong specificity,and enterprise R&D investment has the characteristics of high risk and long cycle.Therefore,management will implement management defense behavior for the motive of position sticking,and then affect the efficiency of enterprise R&D investment.D&O liability insurance is an effective tool to transfer the compensation risk of directors and senior managers.It can protect the personal property of directors and senior managers and produce compensation effect for managers.Therefore,whether the incentive effect of D&O liability insurance can alleviate the defensive motivation of management and then affect the efficiency of R&D investment of enterprises is an important issue worth exploring.In order to study the relationship among managerial position risk,D&O liability insurance and R&D investment efficiency,based on principal-agent theory,managerial human capital theory and management defense hypothesis This paper takes Shanghai and Shenzhen A-share listed companies from 2010 to 2017 as samples to conduct empirical research.Firstly,by combing the existing research results,the paper sorted out the corporate governance factors that affect the involuntary change of management.And use the logit stepwise regression transform the multi-dimensional characteristic variables into a single index to measure the management turnover risk.Then,according to Q investment theory,the relationship between managerial job risk and R&D investment efficiency is empirically tested by SFA.Furthermore,in order to study the governance effect of D&O liability insurance on management defense,this paper further tests the regulatory effect of D&O liability insurance on the relationship between them.The results show that managerial position risk has a significant negative impact on the efficiency of R&D investment;corporate D&O liability insurance has a significant negative moderating effect on the restraint of managerial position risk on the efficiency of R&D investment,indicating that there is a certain substitutional relationship between D&O liability insurance and executive compensation,which can produce incentive effect on managers.D&O liability insurance can be an important supplement to the salary.Based on the results of theoretical analysis and empirical research,this paper puts forward advice for salary system,corporate governance and D&O liability insurance system.The research enriches the existing research on R&D investment efficiency,and tests the incentive effect of D&O on China's capital market.