The effect of executive team heterogeneity on firms’ total factors of production: Evidence from China

Abstract

This study examines the three kinds of heterogeneity of the executive team: heterogeneity of its professional background, overseas experience, and financial background. It also explores the mechanism and impact of these three heterogeneities on the enterprise’s total factor productivity using the Shanghai and Shenzhen A-share listed companies in China as the research samples from 2010–2022. Results reveal that (1) the heterogeneity of the executive team’s professional background, overseas experience and financial background of the military increased the total factor productivity of the enterprise; and (2) improving the enterprise’s financial flexibility, internal control quality, and research and development and innovation are effective paths for the rise in the level of the enterprise’s total factor productivity by the aforementioned heterogeneities.