Purpose

The purpose of this study is to examine the impact of financial and technical education of chief executive officer (CEO) on investment–cash flow sensitivity (ICFS) of Indian manufacturing firms.

Design/methodology/approach

The study uses the dynamic panel data model and more specifically, the system-generalized method of moments (GMM) technique to investigate the effect of CEOs' education on ICFS of Indian manufacturing firms during the period 1998–1999 to 2016–2017.

Findings

The study shows that financial (technical) education of CEOs does (not) affect ICFS. The results explain that the role of the CEO's education in ICFS is highly significant during the crisis period. The robustness test depicts that the influence of financial education on ICFS is less (more) for group-affiliated and large-sized firms (stand-alone and small-sized firms). Further, the CEO's education is significantly associated with corporate investment decisions.

Research limitations/implications

Due to the unavailability of the CEO's compensation data for the selected sample, future research could explore the impact of CEO's education with respect to CEO's compensation on ICFS.

Practical implications

First, the authors find that financially educated CEOs affect ICFS; therefore, firms should take care of CEO's education during recruitment of CEOs. Second, lending agencies should also consider the educational background of the CEO before approval of funding to make it safe. Third, investors should keep in mind the educational background of the CEO for the growth of their investment as it may be easier for financially educated CEOs to borrow from the market at the time of requirement.

Originality/value

This study contributes to the existing literature by providing empirical evidence through analyzing the impact of a CEO's education on ICFS in the context of India. This study is very unique in itself as it uses the sample of manufacturing sectors of India, which are growing very fast and attracting global investors to create a global hub of manufacturing in India. This study also considers different types of education such as financial and technical education of CEOs in the context of a developing economy like India. This study made its findings robust across company characteristics and periods based on the financial crisis.

中文翻译：

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CEO教育与投资-现金流敏感性：实证调查

目的

本研究的目的是检验首席执行官 (CEO) 的财务和技术教育对印度制造企业的投资现金流敏感性 (ICFS) 的影响。

设计/方法/方法

该研究使用动态面板数据模型，更具体地说，使用系统广义矩量法 (GMM) 技术来调查 CEO 教育对 1998-1999 年至 2016-2017 年期间印度制造企业 ICFS 的影响。

发现

研究表明，CEO 的财务（技术）教育不会（不会）影响 ICFS。结果表明，在危机期间，CEO 教育在 ICFS 中的作用非常重要。稳健性检验表明，对于集团附属公司和大型公司（独立公司和小型公司），金融教育对 ICFS 的影响较小（较多）。此外，CEO 的教育与企业投资决策密切相关。

研究限制/影响

由于所选样本的 CEO 薪酬数据不可用，未来的研究可以探讨 CEO 教育对 CEO 薪酬对 ICFS 的影响。

实际影响

首先，作者发现受过金融教育的 CEO 会影响 ICFS；因此，企业在招聘CEO时应重视CEO的教育。其次，贷款机构在批准资金前还应考虑首席执行官的教育背景，以确保资金安全。第三，投资者在投资增长时应牢记 CEO 的教育背景，因为受过金融教育的 CEO 可能更容易在需要时从市场借款。

原创性/价值

本研究通过分析印度背景下 CEO 教育对 ICFS 的影响提供实证证据，为现有文献做出贡献。这项研究本身非常独特，因为它使用了印度制造业的样本，这些行业增长非常快，并吸引了全球投资者在印度创建全球制造业中心。本研究还考虑了不同类型的教育，例如在印度等发展中经济体的背景下对 CEO 的金融和技术教育。这项研究在金融危机的基础上，在公司特征和时期内得出了稳健的结论。