Will The CEO's Technical Background Reduce The Company's Inefficient Investment

In recent years,although the scale of investment by Chinese enterprises has remained high,the inefficiency of investment has also prevailed.Because of the agency problem,the conflict of interest between shareholders and managers will increase the inefficiency of corporate investment.In order to explore the reason and solution of this problem,many experts and scholars all over the world have analyzed and empirically researched the reasons for the inefficiency of investment,and tried to bring about the improvement of investment efficiency from different dimensions.Information asymmetry issues and corporate governance issues to analyze the over-investment or under-investment transmission mechanism and formation drivers,but still fail to solve the problem of inefficient investment by enterprises.Most of the existing literature focuses on the direct impact of variables such as equity incentives on corporate investment efficiency.In view of the technical background,CEOs can rely on their technical knowledge and professional background to more purposefully guide the investment direction of enterprises.This article includes equity incentives.Regulating variables,trying to figure out whether the existence of equity incentives will strengthen or weaken the relationship between technology-based CEOs and inefficient investment by companies.Research on the background characteristics of corporate executives has been very common in previous literature,but most of them start from the executives' age,gender and their education level,etc..The literature between inefficient corporate investments and the background of the CEOs is rarely addressed.After carefully combing the relevant literature,this article takes the technical CEO as the starting point to reduce the inefficient investment of the enterprise,and through analysis of the role of equity incentives and academic background to adjust the role,puts forward how to improve the company's investment efficiency.The last part summarizes and analyzes the conclusions of this article and puts forward shortcomings and prospects.The conclusion is that,as one of the manifestations of special skills,the technical background of an enterprise CEO can make the CEO make a more professional decision,thereby improving the company's investment efficiency.This article finds that both the CEO's professional background characteristics and his academic background characteristics can significantly improve the company's investment efficiency.After the introduction of high-tech enterprises,we found that compared with other enterprises,the technical background of CEOs in high-tech enterprises can improve the company's investment efficiency.In addition,after considering equity incentive factors,we find that equity incentives for CEOs will weaken the impact of CEO's technical background on the company's investment efficiency to a certain extent.The conclusions of this paper not only enrich the relevant literature in the field of corporate efficiency research,but also provide new ideas for research on the micro level of the company from the perspective of the technical background of the corporate CEO.This has certain reference value for corporate governance and how the country can effectively develop high-tech industries and introduce professional technical talents.