Impacts of founder management on the operational efficiency of enterprises in different regions in China

ABSTRACT

Under the influence of the severe downturn in the global economic situation, China’s economy is currently in a difficult and long transition period. How an enterprise maintains high operational efficiency is especially important. As a key management position, the founder has a strong sense of corporate responsibility. Therefore, this study conducted an empirical analysis of the impact of founder management on the enterprises operational efficiency using data on private listed companies in China’s from 2010 to 2019. The results showed that founder management could improve the operational efficiency of enterprises compared with non-founder management. The economic gap between China’s western region and the central and eastern regions has not significantly improved, which will directly affect the development of private enterprises in the western region. We compared the enterprises in western region with non-western regions, and showed that enterprises managed by founders in the western region, compared with those in non-western regions, have reduced positive effects of founder management on their operating efficiency. In China, these conclusions have important theoretical value and practical significance for clarifying the relationship between founder management and operating efficiency because the system is different from that of western countries.

KEYWORDS:

• Enterprise operation efficiency
• founder management
• regional differences
• sense of corporate responsibility

JEL CLASSIFICATION:

• A19
• B23
• C33
• M41

Disclosure statement

No potential conflict of interest was reported by the author(s).