Risk culture in corporate innovation

Po Hsin Ho; Chia Wei Huang; Chih Yung Lin; Ju Fang Yen

doi:10.1016/j.irfa.2023.102999

Risk culture in corporate innovation

Po Hsin Ho, Chia Wei Huang, Chih Yung Lin, Ju Fang Yen^*

^*Corresponding author for this work

Department of Information Management and Finance

Research output: Contribution to journal › Article › peer-review

5 Scopus citations

Abstract

In this study, we utilize stock market beta to examine the impact of corporate risk culture on innovation within U.S. firms. Our results reveal that firms with a pronounced high-risk culture invest more in innovation and generate greater innovation outcomes. These firms tend to employ overconfident or generalist managers and offer them incentive compensation to spur innovation. Further analysis underscores that the influence of risk culture on innovation occurs predominantly in innovative industries. Our findings highlight that firms with a high-risk culture excel in seizing innovative growth opportunities.

Original language	English
Article number	102999
Journal	International Review of Financial Analysis
Volume	91
DOIs	https://doi.org/10.1016/j.irfa.2023.102999
State	Published - Jan 2024

Keywords

Corporate culture
Innovation
Patent
R&d
Risk preference

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10.1016/j.irfa.2023.102999

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title = "Risk culture in corporate innovation",

abstract = "In this study, we utilize stock market beta to examine the impact of corporate risk culture on innovation within U.S. firms. Our results reveal that firms with a pronounced high-risk culture invest more in innovation and generate greater innovation outcomes. These firms tend to employ overconfident or generalist managers and offer them incentive compensation to spur innovation. Further analysis underscores that the influence of risk culture on innovation occurs predominantly in innovative industries. Our findings highlight that firms with a high-risk culture excel in seizing innovative growth opportunities.",

keywords = "Corporate culture, Innovation, Patent, R&d, Risk preference",

author = "Ho, {Po Hsin} and Huang, {Chia Wei} and Lin, {Chih Yung} and Yen, {Ju Fang}",

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AU - Lin, Chih Yung

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AB - In this study, we utilize stock market beta to examine the impact of corporate risk culture on innovation within U.S. firms. Our results reveal that firms with a pronounced high-risk culture invest more in innovation and generate greater innovation outcomes. These firms tend to employ overconfident or generalist managers and offer them incentive compensation to spur innovation. Further analysis underscores that the influence of risk culture on innovation occurs predominantly in innovative industries. Our findings highlight that firms with a high-risk culture excel in seizing innovative growth opportunities.

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KW - Innovation

KW - Patent

KW - R&d

KW - Risk preference

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Risk culture in corporate innovation

Abstract

Keywords

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