Role of foreign and domestic institutional investors in corporate sustainability: Focusing on r&d investment
- 주제(키워드) Domestic institutions , Foreign institutions , Innovation , Institutional investors , R&D , Sustainability
- 등재 SCIE, SSCI, SCOPUS
- OA유형 Green Published, gold
- 발행기관 MDPI AG
- 발행년도 2020
- 총서유형 Journal
- URI http://www.dcollection.net/handler/ewha/000000174795
- 본문언어 영어
- Published As http://dx.doi.org/10.3390/su12208754
초록/요약
This paper examines the effects of ownership by foreign and domestic institutional investors on corporate sustainability by focusing on the level of research and development (R&D) investment. Long-term investment in R&D is crucial for companies that seek to generate sustainable growth. Ordinary least-squares regression is performed on a sample of Korean listed companies. The main test with both foreign and domestic institutional ownership is based on a study period from 2001 to 2004. The results indicate that firms with higher levels of foreign institutional ownership exhibit greater levels of corporate R&D activities, while the ownership by domestic institutions has no significant influence on firms’ R&D investment. An additional test with foreign institutional ownership data is based on an extended study period from 2001 to 2014, and shows that foreign institutional ownership is positively related to firms’ R&D investment. This result survives the two-stage instrumental variable approach used to address endogeneity factors in foreign institutional ownership. Taken together, these findings suggest that foreign institutions can effectively monitor managerial myopia and promote corporate innovations. © 2020 by the authors. Licensee MDPI, Basel, Switzerland.
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