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Invest for customer: Customer orientation and investment efficiency

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  • Liu, Chengcheng
  • Wang, Ziyi
  • Lin, Yu-En

Abstract

This study examines the impact of customer orientation on corporate investment efficiency, as well as how this relationship varies with marketing capability. Using keywords extracted from the annual reports of Chinese listed companies to measure customer orientation, we find that customer orientation improves corporate investment efficiency by reducing both under-investment and over-investment. This relationship is positively moderated by marketing capability. Moreover, the positive relationship between customer orientation and investment efficiency is more pronounced when customer volatility is low or customer concentration is high. We also demonstrate that this effect does not differ across levels of agency costs. Overall, our study highlights the vital role of customer value in enhancing corporate investment efficiency by mitigating information asymmetry between managers and customers, rather than operating through agency conflicts between managers and shareholders.

Suggested Citation

  • Liu, Chengcheng & Wang, Ziyi & Lin, Yu-En, 2026. "Invest for customer: Customer orientation and investment efficiency," Research in International Business and Finance, Elsevier, vol. 88(C).
    • Handle: RePEc:eee:riibaf:v:88:y:2026:i:c:s0275531926001820
    DOI: 10.1016/j.ribaf.2026.103455
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