A Study on the Impact of Top Management Team Political Connection on Diversification

Abstract

Taking listed companies in Hubei Province as an example, this paper empirically studies the influence of political connection of top management team on diversification of listed companies. The results show that the political connection of top management team has significant influence on the diversification of enterprises, among which the degree of diversification of politically related enterprises is higher than that of nonpolitically related enterprises. Moreover, the influence of local political affiliation on diversification of listed companies is stronger than that of central political affiliation. Keywords—political connection; diversified management; listed companies