Role of Research and Development Innovation between Ownership Structure and Firm Performance

Abstract

This study investigates the moderating role of research and development intensity (R&D) between ownership structure (OS) and financial firm performance (FP). The Estimated Generalized Least Squares (EGLS) model was used on a panel data sample of 296 non-financial firms listed at the Pakistan Stock Exchange (PSX) during 2011-2020. Research findings help to understand the R&D innovation policy implementation support to enhance the firm’s financial performance. The results indicate that R&D innovation interaction with OS (concentrated, institutional, managerial, and family ownership) has a positive and statistically significant association with FP and varies according to performance measures. The study findings contain functional implications for practising corporate governance (CG) in emerging economies. Non-financial firms in emerging countries can enhance their financial performance by investing in R&D innovation projects.