Does knowledge of digital technology affect corporate innovation? Evidence from CEOs with digital technology backgrounds in China

Abstract

Global economies are increasingly focusing on digital technology to break through the conventional innovation development pattern. This study examines the degree to which CEOs with digital technology backgrounds affect corporate innovation. In a broader sense, it investigates the significance of digital technology in the innovation transformation of global economies. We find that CEOs with digital technology backgrounds significantly enhance corporate innovation performance. Mechanistic tests indicate that CEOs with digital technology backgrounds promote corporate innovation performance through a stronger willingness for digital transformation, higher level of internal control management and focus on fostering a stronger culture of collaboration compared to CEOs without digital technology backgrounds. Additionally, CEOs with digital technology backgrounds are better at promoting corporate innovation within state-owned enterprises and enterprises that do not receive industrial policy support. Further analysis suggests that CEOs have a greater impact on corporate innovation when the macroeconomic environment is compatible with their personal traits. Therefore, for companies competing in the field of digital technology, talent construction is vital to gaining a competitive advantage.