IDEAS home Printed from https://ideas.repec.org/a/eee/reveco/v100y2025ics1059056025002874.html

Stability of executive teams, corporate financialization, and cross-border mergers and acquisitions

Author

Listed:
  • Cai, Cen
  • He, Limiao
  • Wen, Jialian

Abstract

In the backdrop of accelerating global economic integration, cross-border mergers and acquisitions (M&A) have emerged as a crucial strategy for firms to penetrate international markets and secure strategic assets. Utilizing microdata from Chinese listed companies spanning from 2008 to 2022, this study delves into the underlying mechanisms through which executive team stability and corporate financialization influence cross-border M&A outcomes. The findings indicate that executive team stability exerts a notably positive influence on cross-border M&A: a more stable executive team correlates with a higher success rate and shorter completion time for these transactions. This positive effect demonstrates considerable variation across different industry sectors. Conversely, corporate financialization is found to negatively impact the success rate of cross-border M&A, although its influence on the completion time is insignificant. Moreover, the study unveils that corporate financialization acts as a negative moderator in the relationship between executive team stability and the success rate of cross-border M&A, with this moderating effect exhibiting significant disparities between strategic resource-based industries and non-strategic resource-based industries.

Suggested Citation

  • Cai, Cen & He, Limiao & Wen, Jialian, 2025. "Stability of executive teams, corporate financialization, and cross-border mergers and acquisitions," International Review of Economics & Finance, Elsevier, vol. 100(C).
    • Handle: RePEc:eee:reveco:v:100:y:2025:i:c:s1059056025002874
    DOI: 10.1016/j.iref.2025.104124
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S1059056025002874
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.iref.2025.104124?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to

    for a different version of it.

    References listed on IDEAS

    as
    1. Maung, Min, 2022. "Trust and cross-border mergers and acquisitions," International Review of Financial Analysis, Elsevier, vol. 83(C).
    2. Bischof, Jannis & Laux, Christian & Leuz, Christian, 2021. "Accounting for financial stability: Bank disclosure and loss recognition in the financial crisis," Journal of Financial Economics, Elsevier, vol. 141(3), pages 1188-1217.
    3. Zhang, Mingyue & Peng, Donghui, 2023. "The impact of digital transformation on corporate cross-border mergers and acquisitions," Finance Research Letters, Elsevier, vol. 58(PB).
    4. Shenghui Ma & Yasemin Y. Kor & David Seidl, 2022. "Top management team role structure: A vantage point for advancing upper echelons research," Strategic Management Journal, Wiley Blackwell, vol. 43(8), pages 1-28, August.
    5. Feng, Hongxia & Yang, Bowen & Bhandari, Pratikshya, 2024. "The influence of CSR on cross-border mergers and acquisitions," Finance Research Letters, Elsevier, vol. 70(C).
    6. Yuan, Chen & Jiang, Hanming & Chen, Chen, 2023. "Differences in returns to cross-border and domestic mergers and acquisitions: Empirical evidence from China using PSM-DID," Finance Research Letters, Elsevier, vol. 55(PB).
    7. Nguyen, Quang Khai, 2022. "Audit committee structure, institutional quality, and bank stability: evidence from ASEAN countries," Finance Research Letters, Elsevier, vol. 46(PA).
    8. Liu, Zehao & Tang, Huoqing & Zhang, Chengsi, 2023. "Corporate governance, moral hazard, and financialization," International Review of Economics & Finance, Elsevier, vol. 88(C), pages 318-331.
    9. Dong, Jichang & Yin, Lijun & Liu, Xiaoting & Hu, Meiting & Li, Xiuting & Liu, Lei, 2020. "Impact of internet finance on the performance of commercial banks in China," International Review of Financial Analysis, Elsevier, vol. 72(C).
    10. Xing, Chao & Zhang, Yuming & Tripe, David, 2021. "Green credit policy and corporate access to bank loans in China: The role of environmental disclosure and green innovation," International Review of Financial Analysis, Elsevier, vol. 77(C).
    11. Danting Cao & Yike Yu, 2023. "Top management team stability and enterprise innovation: A chairman's implicit human capital perspective," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(4), pages 2346-2365, June.
    12. Arena, Matteo P. & Dewally, Michaël & Jain, Bharat A. & Shao, Yingying, 2022. "Family firms' cross-border mergers and acquisitions," International Review of Financial Analysis, Elsevier, vol. 82(C).
    13. HaiYue Liu & YiXian Li & Rui Yang & XiaoPing Li, 2021. "How Do Chinese Firms Perform Before and After Cross-Border Mergers and Acquisitions?," Emerging Markets Finance and Trade, Taylor & Francis Journals, vol. 57(2), pages 348-364, January.
    14. Zheng, Di & Lei, Lei & Wang, Licheng & Li, Xuefeng, 2024. "Inhibiting or promoting: The impact of corporate social responsibility on corporate financialization," International Review of Economics & Finance, Elsevier, vol. 89(PA), pages 1404-1421.
    15. Dariusz Wójcik & Liam Keenan & Vladimír Pažitka & Michael Urban & Wei Wu, 2022. "The Changing Landscape of International Financial Centers in the Twenty-First Century: Cross-border Mergers and Acquisitions in the Global Financial Network," Economic Geography, Taylor & Francis Journals, vol. 98(2), pages 97-118, March.
    16. Yu, Zhiyang & Yu, Kaibin & Ye, Ying & Wang, Canghong, 2024. "Corporate financialization and the spread of issuing bonds," Finance Research Letters, Elsevier, vol. 59(C).
    17. Kun Su & Heng Liu, 2021. "Financialization of manufacturing companies and corporate innovation: Lessons from an emerging economy," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 42(4), pages 863-875, June.
    18. Wang, Jiaxin & Yuan, Xue & Huang, Xiang & Liu, Chengxin & Zhang, Pengdong, 2024. "Can digitalization facilitate cross-border M&A? Evidence from Chinese A-share listed companies," Research in International Business and Finance, Elsevier, vol. 67(PA).
    19. Wei Cao & Chunhua Chen & Dequan Jiang & Weiping Li & Ying Zhang, 2022. "Industrial policy and non-financial corporations’ financialization: evidence from China," The European Journal of Finance, Taylor & Francis Journals, vol. 28(4-5), pages 397-415, March.
    20. Kara, Alper & Zhou, Haoyong & Zhou, Yifan, 2021. "Achieving the United Nations' sustainable development goals through financial inclusion: A systematic literature review of access to finance across the globe," International Review of Financial Analysis, Elsevier, vol. 77(C).
    21. Huang, Bingbing & Cui, Yuying & Chan, Kam C., 2022. "Firm-level financialization: Contributing factors, sources, and economic consequences," International Review of Economics & Finance, Elsevier, vol. 80(C), pages 1153-1162.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. 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).
    2. Ding, Zhiguo & Liu, Xinmiao & Ding, Yuyang, 2025. "How information structure shapes insider valuation bias: Evidence from insider selling in China," Finance Research Letters, Elsevier, vol. 85(PD).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Xing, Yafei & Wang, Junwei & Lu, Yitian, 2025. "Corporate governance, international financial development, and cross-border mergers and acquisitions," International Review of Economics & Finance, Elsevier, vol. 103(C).
    2. Guo, Jingyi & Zheng, Yinglong & Du, Shilin & Tian, Grace (Li), 2025. "Institutional shareholding, corporate financialization, and regulatory penalties for listed companies," International Review of Economics & Finance, Elsevier, vol. 99(C).
    3. Dong, Zixuan & Abd Aziz, Mohd Faiq & Wang, Yan, 2025. "Human capital accumulation, technological progress, and corporate financialization," International Review of Economics & Finance, Elsevier, vol. 101(C).
    4. Li, Yanting & Yu, Kaijie, 2025. "Cooperative governance or profit extraction: the exit threat of non-controlling major shareholders and corporate cross-border M&A behavior," Finance Research Letters, Elsevier, vol. 85(PB).
    5. Chen, Lirong & Long, Yuxuan & Tang, Xuemei & Wang, Jiani, 2025. "Can accounts receivable factoring restrain corporate financialization? Evidence from China," International Review of Economics & Finance, Elsevier, vol. 98(C).
    6. Zhao, Yingying & Wang, Zhiyu, 2025. "Anti-Unfair competition law, corporate financialization, and corporate social responsibility fulfillment," Finance Research Letters, Elsevier, vol. 79(C).
    7. Xing, Yafei & Wang, Junwei & Liu, Zheng & Xiao, Daibo, 2025. "The impact of corporate financialization on ESG performance: A perspective based on executive incentives," Finance Research Letters, Elsevier, vol. 76(C).
    8. Guo, Juanjuan & Sun, Hongfeng & Wang, Shihao & Liu, Chang, 2025. "Sword suppress virtual fire: Bank regulatory sanctions help companies shift from financial to real economic activities," International Review of Financial Analysis, Elsevier, vol. 108(PB).
    9. Li, Chengming & Wang, Hanyang & Zhang, Changyun, 2026. "Digital transformation and corporate mergers and acquisitions: Evidence and mechanism in China," Pacific-Basin Finance Journal, Elsevier, vol. 95(C).
    10. Li, Jing & Huang, Lei & Qin, Yiyang, 2025. "Analyst attention, green credit policies, and corporate environmental responsibility fulfillment," Finance Research Letters, Elsevier, vol. 76(C).
    11. Wu, Xinmei & Wu, Xinhong & Shang, Duo & Fan, Libo, 2025. "Digital transformation and firm business diversification: An inverse U-shaped relationship," Economic Analysis and Policy, Elsevier, vol. 87(C), pages 874-892.
    12. Ju, Chunhua & Fang, Xusheng & Shen, Zhonghua, 2024. "Investor attention and corporate financialization: Evidence from internet search volume," International Review of Financial Analysis, Elsevier, vol. 96(PA).
    13. Yu, Ziqin & Xiao, Xiang & Ge, Ge, 2025. "Shadow banking regulation and firm investment efficiency: Evidence from China's new regulation of capital management," Research in International Business and Finance, Elsevier, vol. 77(PB).
    14. Cheng, Xuemei & Zheng, Yinglong & Bi, Siyuan & Chen, Fangxin, 2025. "Impact of litigation risk on the cost of corporate debt financing: The moderating role of earnings management strategies," Finance Research Letters, Elsevier, vol. 80(C).
    15. Ning, Zihao & Xu, Zhibo & Zheng, Pengju, 2024. "The impact of common institutional ownership on financialization in non-financial enterprise: Exacerbation or inhibition?," Finance Research Letters, Elsevier, vol. 69(PB).
    16. Li, Xing & Shen, Guangjun, 2023. "Do tax incentives decelerate corporate financialization? Evidence from the VAT reform in China," Economic Modelling, Elsevier, vol. 125(C).
    17. Liu, Qi & Shi, Changying, 2025. "ETF ownership and corporate financialization," Finance Research Letters, Elsevier, vol. 82(C).
    18. Zhu, Yafang & Guo, Yuanyuan, 2024. "How does implementing the social insurance law affect enterprises' investment preferences?," International Review of Financial Analysis, Elsevier, vol. 96(PA).
    19. Shi, Wenxiang & Fang, Peijie, 2023. "Delisting regulation and corporate financialization: Evidence from China," Finance Research Letters, Elsevier, vol. 58(PD).
    20. Wang, Lixin & Zhang, Rong, 2025. "Executive equity incentives, cash holdings and corporate financialization," Finance Research Letters, Elsevier, vol. 85(PD).

    More about this item

    Keywords

    ;
    ;
    ;

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:reveco:v:100:y:2025:i:c:s1059056025002874. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/locate/inca/620165 .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.