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The dark side of earnings pressure: the case of firms’ collaborative innovation

Author

Listed:
  • Ge Ren
  • Ping Zeng
  • Xi Zhong

Abstract

Analysts play an important role in corporate innovation. However, to date, we do not know what role earnings pressure, which stems from firms’ performance failing to meet or beat analysts’ earnings expectations, will play in corporate collaborative innovation. Integrating agency theory and the behavioural theory of the firm, we construct a theoretical framework to systematically explore the logical relationship between earnings pressure and firms’ collaborative innovation. On the basis of empirical data of A-share manufacturing companies listed in China from 2010 to 2021, we find that earnings pressure inhibits firms’ collaborative innovation. In addition, innovation performance shortfall strengthens the above relationship, whereas financial slack and academic capital weaken it. By providing the first theoretical and empirical evidence on the relationship between earnings pressure and firms’ collaborative innovation, this study expands the literature on earnings pressure and collaborative innovation and sheds important light on optimising the capital market structure to enhance firms’ innovation capabilities.

Suggested Citation

  • Ge Ren & Ping Zeng & Xi Zhong, 2026. "The dark side of earnings pressure: the case of firms’ collaborative innovation," Industry and Innovation, Taylor & Francis Journals, vol. 33(5), pages 566-589, May.
    • Handle: RePEc:taf:indinn:v:33:y:2026:i:5:p:566-589
    DOI: 10.1080/13662716.2025.2522882
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