Social Capital Of The Board, Industrial Support And Diversification

After the financial crisis in 2008,Chinas economy was severely affected.It faced the dilemma of shrinking external demand and overcapacity.Many industries and enterprises were difficult to produce and operate,and the number of unemployed people increased,and the economic growth rate dropped significantly.At the same time,the worlds major economies began a new round of planning and layout for future industrial development.In order to narrow the gap between economic and technological aspects of developed countries,the government made a strategic decision to vigorously cultivate and develop strategic emerging industries to achieve the goal of optimizing and upgrading industrial structure and sustainable economic development in 2010.After Chinas eco nomy has entered a new normal,phasing out backward production capacity,promoting industrial structure upgrading and transforming economic development mode have become the top priority of Chinas government work.Local governments at all levels have successively issued a series of industrial policies in response to the call of the central government to develop strategic emerging industries,such as tax incentives,government subsidies,innovation investment,credit funds,project approval,etc.It is not difficult to see that strategic emerging companies are more favored and supported than by the government.As the bridge between the enterprise and the external environment,the board of directors plays an irreplaceable role in the selection,formulation and implementation of corporate strategic decision-making and business methods.The richness of the social capital of the board of directors plays a vital role in Chinese enterprises,especially private enterprises.Play a vital role.This is because Chinas market mechanism is still not perfect and the system construction is weak.As an effective alternative mechanism,social capital helps private enterprises to obtain the key market information and scarce resources needed for diversified operations.This paper divides the social capital of the board of directors into two dimensions: the political connection between the board of directors and the business relationship of the board of directors.The purpose of this paper is to discuss two main issues: First,whether the political ties of the board of directors and the business contacts of the board of directors have an impact on the diversification of strategic emerging enterprises and traditional enterprises and their impact mechanisms.Second,whether industrial policies have a regulatory effect on the diversification of strategic emerging enterprises and traditional enterprises and their mechanisms of action.Based on the above-mentioned realistic background,the causes and consequences of diversification of strategic emerging enterprises and traditional enterprises need to be further deepened and expanded.Firstly,this paper reviews and combs the theoretical literature,defines the relevant concepts,and analyses the theoretical basis of the impact of social capital and industrial policy on strategic emerging enterprises and traditional enterprises diversification from the perspective of resource and system theory,this paper takes private manufacturing enterprises listed in Shanghai and Shenzhen A shares in the Yangtze River Delta region from 2013 to 2017 as samples.The research finds both the political connections and the commercial connections of the board can promote the improvement of business performance.The richer the political connections of the board of directors,the more likely strategic emerging enterprises are to implement independent diversification strategy to improve their business performance;the more abundant the business connections of the board of directors,the more likely traditional enterprises are to implement relevant diversification strategy to improve their business performance.To some extent,industrial policy can strengthen the positive impact of the board of directors political links on the implementation of irrelevant diversification strategy for strategic emerging enterprises,and industrial policy can strengthen the impact of the board of directors commercial links on the implementation of relevant diversification strategy for traditional enterprises to a certain extent.This paper synthesizes the influence of social capital and industrial policy on strategic emerging enterprises and traditional enterprises diversification in a research framework,studies the relationship between various elements,reveals the causes and consequences of private enterprises diversification more thoroughly,perfects the theory of social capital and diversification,and serves as enterprises in emerging economies countries.This paper provides empirical evidence from the dual perspectives of micro-social capital and macroIndustrial policy,which has certain theoretical value and practical significance.