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Dynamic capabilities as an enabling mechanism: Top management team heterogeneity and M&A performance

Author

Listed:
  • Yang, Xinyi
  • Shao, Haiqing
  • Hao, Qiang
  • Li, Yue

Abstract

This study takes Chinese A-share listed companies as its research sample to empirically examine the impact of top management team (TMT) heterogeneity on corporate merger and acquisition (M&A) performance. The findings reveal that TMT heterogeneity exerts a significant positive influence on M&A performance. This enhancement effect is primarily realized through the strengthening of corporate dynamic capabilities. Further analysis of moderating effects indicates that internal pay disparity weakens the positive effect of TMT heterogeneity, whereas high financing efficiency provides crucial resource support, thereby strengthening this positive relationship. Heterogeneity analysis shows that the value-creating effect of TMT heterogeneity in M&As is more pronounced in firms with higher cost of equity capital, abundant slack resources, and higher ownership concentration.

Suggested Citation

  • Yang, Xinyi & Shao, Haiqing & Hao, Qiang & Li, Yue, 2026. "Dynamic capabilities as an enabling mechanism: Top management team heterogeneity and M&A performance," Finance Research Letters, Elsevier, vol. 91(C).
    • Handle: RePEc:eee:finlet:v:91:y:2026:i:c:s1544612325026959
    DOI: 10.1016/j.frl.2025.109446
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    Keywords

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    JEL classification:

    • G34 - Financial Economics - - Corporate Finance and Governance - - - Mergers; Acquisitions; Restructuring; Corporate Governance
    • L25 - Industrial Organization - - Firm Objectives, Organization, and Behavior - - - Firm Performance
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation
    • G32 - Financial Economics - - Corporate Finance and Governance - - - Financing Policy; Financial Risk and Risk Management; Capital and Ownership Structure; Value of Firms; Goodwill

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