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Corporate governance practices and companies' R&D orientation: Evidence from European countries. Bruegel Working Paper 2011/01, 24 January 2011

van Pottelsberghe, Bruno and Honore, Florence and Munari, Federico. (2011) Corporate governance practices and companies' R&D orientation: Evidence from European countries. Bruegel Working Paper 2011/01, 24 January 2011. [Working Paper]

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    Abstract

    This working paper empirically investigates if corporate governance practices affect the resources firms devote to R&D. The authors Florence Honoré, Federico Munari and Bruno van Pottelsberghe found that an executive remuneration system that is linked to the firm’s financial performance has a particularly strong negative impact on R&D. This confirms the hypothesis that incentive mechanisms lead managers to focus on more predictable and easily measurable short-term activities,ultimately hampering the commitment to innovative projects.

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    Item Type: Working Paper
    Subjects for non-EU documents: EU policies and themes > Policies & related activities > innovation policy
    EU policies and themes > Policies & related activities > RTD policy/European Research Area
    EU policies and themes > Policies & related activities > economic and financial affairs > business/private economic activity
    Subjects for EU documents: UNSPECIFIED
    EU Series: UNSPECIFIED
    ["eprint_fieldname_eusries" not defined]: UNSPECIFIED
    EU Annual Reports: UNSPECIFIED
    Series: Series > Bruegel (Brussels) > Working Papers
    Depositing User: Phil Wilkin
    Official EU Document: No
    Language: English
    Date Deposited: 26 Jan 2011
    Page Range: p. 43
    Last Modified: 15 Feb 2011 18:41
    URI: http://aei.pitt.edu/id/eprint/15489

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