The Impact Of Executives' Social Relations On Their Business Performance And Related Party Transactions

At present,China's economy is in a transitional period,and the competitive environment in the market is rapidly changing.An unpredictable market environment requires enterprises to make quick and effective measures.Enterprises need timely information and resources to cope with the rapidly changing environment.As a key member of the enterprise,executives' own social capital plays an important role in how enterprises make sound decisions in a changing environment to avoid market risks.In a rapidly changing market environment,executives' social network relationships can provide businesses with more information and resources.Most scholars at home and abroad mainly study the impact of corporate system level and equity setting on business performance and related party transactions.Chinese-style social relations play an important role in corporate management and decision-making process.Few scholars regard executive social relations And business performance and related party transactions.Therefore,this article mainly studies the impact of executive social relations on the company's business performance and related party transactions.From the perspective of social network,this paper describes the social relations constituted by senior executives from the perspective of alumni,and studies its influence on the related party transactions and business performance from the perspective of senior management internal social relations and external social relations respectively.This paper first studies the influence of the external social relations of senior executives on the performance of the company and explores the nature of the property rights of enterprises and whether the business registration will affect the formation of social relations.Secondly,it studies the influence of senior executives' internal social relations on the company's tunneling related transactions.In this paper,a sample of A-share listed companies in China is taken as a sample to test the executive performance of senior executives and the hypotheses of related party transactions using the multiple linear regression method.The research shows that the external social relations of senior executives are positively correlated with the corporate performance,the nature of corporate property is not related to the external social relations of executives,and the business registration is positively related to the external social relations of senior executives.The internal social relations of seniorexecutives are related to the hollowed-related transactions,indicating that the internal social relations of senior executives weakens the supervisory role of the directors,while the concentration of ownership restrains the influence of senior executives' internal social relations on the hollow-related transactions.The conclusion of the study shows that the formation of rich external social relations by senior executives is conducive to the improvement of business performance,and the internal social relations of senior executives significantly reduce the supervisory role of directors on related party transactions.Therefore,corporate executives should enrich the external social network,and the company executives candidates can consider the nepotism as one of the considerations.