Can Founder Control and Management Participation Affect Strategic Adaptation of Academic Ventures? Evidence from the Chinese New OTC Market
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DOI: 10.25236/ICSM.2019.037
Author(s)
Wei Liu, Shuxia Wang, Yingying Zheng, Yanyan Liu
Corresponding Author
Wei Liu
Abstract
Strategic adaptation is pivotal to companies’ survival and development. However, for new ventures with lower levels of structural inertia and responding quicker to the environment, especially the growth stage of academic ventures, governance and ownership has its own characteristics and combined with that academic ventures rely more on technology and knowledge from academic entrepreneurs, which leads to the fact that academic entrepreneurs can greatly influence ventures’ strategies and behaviours. Therefore, the purpose of this study is to examine empirically whether academic founder control and management participation has an effect on strategic adaptation of academic ventures in Chinese context. This study used a large sample of the Chinese New OTC Market listed companies listed before 2016. The study shows that the academic founder control has a negative relationship with strategic adaptation of academic ventures, but the management participation of academic founder exerts a significant relationship with strategic adaptation of academic ventures. Furthermore, if there is a principal-agent structure in academic ventures, the relationship between of founder control and strategic adaptation is not significant. Because of professional managers, academic ventures tend to adopt opportunistic strategies. The study suggests that the academic ventures in the New OTC Market should grasp the current strategic adaptation and find out their strategic focus, and timely adjust the corporate governance structure for facilitating development.
Keywords
Academic Ventures; Governance Structure; Strategic Adaptation; the New OTC Market; China