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Investigation into the effects of equity incentives for executives and R&D personnel on corporate financialization

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  • Chen, Sichong
  • Liang, Shan
  • Chen, Meng
  • Zhang, Didi

Abstract

This study examines, from the perspectives of executive and R&D personnel, whether equity incentives influence the financialization of enterprises, and investigates the underlying mechanism through which this influence operates. Findings reveal that equity incentives for corporate executives contribute to reducing corporate financialization. Furthermore, equity incentives decrease excess cash holdings in enterprises, which subsequently mitigates the degree of corporate financialization. Notably, compared to state-owned enterprises (SOEs), equity incentives for executives in non-SOEs yields a more significant reduction in corporate financialization.

Suggested Citation

  • Chen, Sichong & Liang, Shan & Chen, Meng & Zhang, Didi, 2025. "Investigation into the effects of equity incentives for executives and R&D personnel on corporate financialization," Finance Research Letters, Elsevier, vol. 77(C).
    • Handle: RePEc:eee:finlet:v:77:y:2025:i:c:s1544612325003654
    DOI: 10.1016/j.frl.2025.107102
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    References listed on IDEAS

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