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From the perspective of the effectiveness of internal control, according to the Stakeholder Theory, Principal-Agent Theory and Reputation Theory, this paper analyzes comparatively the influences of internal control on the assumption of corporate social responsibility (SCPS) from the accrual basis, and the fulfillment of corporate social responsibility (CSRF) from the cash flow system respectively. Using a sample of 1767 firms listed in China between 2011 and 2016, we find that effective internal control has significantly promoted enterprises to assume social responsibilities. Meanwhile, effective internal control substantially improves the fulfillment of corporate social responsibility. This study overcomes the current situation that the two concepts of assumption and fulfillment of corporate social responsibility have not been distinguished in previous literature. We suggest that, in the economic transition period, the positive role of internal control in corporate governance should be promoted to protect the legitimate rights and interests of stakeholders; the adverse impact of the principal-agent relationship between shareholders and management on corporate governance should be avoided, building high-quality internal control; enterprises achieve steady and sustainable development process by the positive reputation value and robust external monitoring mechanism. This research is of practical importance to strengthen the subsequent construction of the internal control system and the long-term practice of corporate social responsibility.
Xiao Li; Chunmei Zheng; Gang Liu; Muhammad Safdar Sial. The Effectiveness of Internal Control and Corporate Social Responsibility: Evidence from Chinese Capital Market. Sustainability 2018, 10, 4006 .
AMA StyleXiao Li, Chunmei Zheng, Gang Liu, Muhammad Safdar Sial. The Effectiveness of Internal Control and Corporate Social Responsibility: Evidence from Chinese Capital Market. Sustainability. 2018; 10 (11):4006.
Chicago/Turabian StyleXiao Li; Chunmei Zheng; Gang Liu; Muhammad Safdar Sial. 2018. "The Effectiveness of Internal Control and Corporate Social Responsibility: Evidence from Chinese Capital Market." Sustainability 10, no. 11: 4006.
Although the relationship between board gender diversity and a firm’s financial performance has been investigated before, the current study provides a valuable contribution by exploring the complex phenomenon of the mediating impact of corporate social responsibility (CSR) performance on a firm’s financial performance. The current study aims to explore whether corporate social responsibility (represented by the proxy variable of CSR reporting) mediates the relationship between boardroom gender diversity and firm performance. We use the pooled ordinary least square (OLS) regression to examine the above relationship by using data from 2008 to 2015. To control the likelihood of endogeneity we also use one-year lagged and two-stage least square (2SLS) regression models. Our results show that boardroom gender diversity is significant, positively correlated with firm performance, and CSR fully mediates the relationship between boardroom gender diversity and firm performance. In addition, four control variables (independent director, Chief executive officer (CEO power), board member meeting frequency, Big4, and leverage) have some influence on firm performance. These findings hold for a set of robustness tests. Our findings have the implication for the investors and regulators. For investors, our results show that the existence of female directors on the board can improve the firm performance. For regulators, our results advise the worldwide policy maker to give the importance to boardroom gender diversity. The paper contributes to the existing studies, by pioneering the investigations of the mediating role of CSR in the relation between boardroom gender diversity and firm performance in Chinese context.
Muhammad Safdar Sial; Chunmei Zheng; Jacob Cherian; M.A. Gulzar; Phung Anh Thu; Tehmina Khan; Nguyen Vinh Khuong. Does Corporate Social Responsibility Mediate the Relation between Boardroom Gender Diversity and Firm Performance of Chinese Listed Companies? Sustainability 2018, 10, 3591 .
AMA StyleMuhammad Safdar Sial, Chunmei Zheng, Jacob Cherian, M.A. Gulzar, Phung Anh Thu, Tehmina Khan, Nguyen Vinh Khuong. Does Corporate Social Responsibility Mediate the Relation between Boardroom Gender Diversity and Firm Performance of Chinese Listed Companies? Sustainability. 2018; 10 (10):3591.
Chicago/Turabian StyleMuhammad Safdar Sial; Chunmei Zheng; Jacob Cherian; M.A. Gulzar; Phung Anh Thu; Tehmina Khan; Nguyen Vinh Khuong. 2018. "Does Corporate Social Responsibility Mediate the Relation between Boardroom Gender Diversity and Firm Performance of Chinese Listed Companies?" Sustainability 10, no. 10: 3591.
This study aims to investigate whether firm performance influences corporate social responsibility reporting of Chinese listed companies. We have used the sample of all A-share listed firms on Shenzhen and Shanghai stock exchanges for the period 2008 to 2015. The authors used pooled ordinary least squares (OLS) regression as a baseline methodology. To control the possible problem of endogeneity we use one year lagged and two-stage least squares regression. We find that firm performance has a statistically significant impact on CSR reporting. Moreover, we see that firms with high performance are more likely to report CSR activities than low-performance firms. Additionally, five of the control variables (board size, CEO power, SOE, firm size, and Big4) have some influence on CSR reporting. These findings hold for a set of robustness tests. Our results have implications for the development of CSR reporting in developing countries like China. Our research suggests that, in China, companies with better financial performance undertake more CSR reporting. The paper contributes to the existing literature by investigating the effect of firm performance on CSR reporting of Chinese listed companies. Additionally, this paper enriches the current literature on CSR reporting and highlights the importance of a firm’s financial performance for better environmental performance and reporting.
Muhammad Safdar Sial; Chunmei Zheng; Nguyen Vinh Khuong; Tehmina Khan; Muhammad Usman. Does Firm Performance Influence Corporate Social Responsibility Reporting of Chinese Listed Companies? Sustainability 2018, 10, 2217 .
AMA StyleMuhammad Safdar Sial, Chunmei Zheng, Nguyen Vinh Khuong, Tehmina Khan, Muhammad Usman. Does Firm Performance Influence Corporate Social Responsibility Reporting of Chinese Listed Companies? Sustainability. 2018; 10 (7):2217.
Chicago/Turabian StyleMuhammad Safdar Sial; Chunmei Zheng; Nguyen Vinh Khuong; Tehmina Khan; Muhammad Usman. 2018. "Does Firm Performance Influence Corporate Social Responsibility Reporting of Chinese Listed Companies?" Sustainability 10, no. 7: 2217.