"Spousal cogovernance" and enterprise innovation: an empirical study based on China's listed family businesses

Family businesses significantly influence the private economy and economic growth. Achieving sustainable development and innovation-driven national strategies necessitates fostering innovation in family businesses. Innovation enables businesses to prosper, mitigate market risks, and facilitate intergenerational succession. In contemporary Chinese family businesses, actual controllers, particularly spouses, play a crucial role in management and strategy formulation, which influences corporate innovation through synergistic effects and enhanced decision-making efficiency. This study investigates the impact of spousal cogovernance on family business innovation by analysing data from A-share listed Chinese family businesses from 2009 to 2020. The findings indicate that spousal cogovernance enhances innovation by promoting harmonious relationships and strong inheritance intentions. However, the number of actual controllers and Confucian culture may adversely affect the promotion of innovation. Moreover, agency costs serve as a mediating factor in driving innovation, and minimizing these costs could enhance innovation. In conclusion, this research expands the knowledge of family governance and innovation and illuminates the differences resulting from internal structural changes in Chinese family businesses. We underscore the significance of nurturing innovation and development in spousal cogoverned family enterprises.