Equity structure and corporate innovation performance: Evidence from Chinese high-tech companies

In the era of globalization and technological innovation, enhancing business innovation performance is pivotal for driving economic growth and maintaining competitive edge. Among the various aspects of corporate governance, equity structure stands out for its influence on firms' innovative activities. This study explores the impact of equity structure on the innovation performance of high-tech listed companies, as well as the mediating role of R&D investment and the moderating effect of market competition. A review of the literature identifies gaps in current research, such as the lack of attention to the multifaceted influence of equity structure and the limited focus on how external environmental factors affect innovation performance. The research employs a bidirectional fixed-effects regression model, analyzing unbalanced panel data from high-tech listed companies between 2012 and 2021. Findings suggest an inverted U-shaped relationship between equity ownership concentration and innovation performance, indicating that both low and excessive concentration can be detrimental. Additionally, equity checks and balances positively influence innovation performance. R&D investment acts as a mediator between equity structure and innovation performance, while market competition moderates the relationship between ownership concentration and innovation performance. However, the moderating role of equity checks and balances on innovation performance is not significant. These results offer new insights into how equity structure, R&D investment, and market competition jointly affect innovation performance. They provide practical guidance for high-tech listed companies seeking to optimize their shareholding structures and enhance their innovation capabilities, as well as a theoretical foundation for policymakers developing strategies to foster corporate innovation. Further research could expand this analysis to different sectors and geographic contexts, examining additional mediating and moderating variables. The findings serve as a valuable reference for optimizing equity structures and leveraging the mediating role of R&D investment to promote the healthy and orderly development of high-tech firms.