The Effectiveness of Internal Control and Corporate Social Responsibility: Taking Gender Diversity into Consideration

• Main Authors: Ya Wen Cheng, 鄭雅文
• Other Authors: H. Y. Chang
• Format: Others
• Language: en_US
• Published: 2016
• Online Access: http://ndltd.ncl.edu.tw/handle/28739027573768975666

碩士 === 長庚大學 === 工商管理學系 === 104 === We examine the relation between internal control effectiveness and corporate social responsibility (CSR). The financial scandals reoccur recently leading to several companies bankrupt and investor losses, which increasingly draws society’s attention to internal control effectiveness and evokes the spirits of the CSR. Also, implementing new corporate governance legislation such as Sarbanes- Oxley Act makes many others focus on the effect of the gender diversity. The aim of this study is to find the correlation between internal control effectiveness and CSR in order to strengthen the internal control system and reduce occurrence of frauds. In addition, we investigate the moderating role of gender diversity. We test the hypothesis that the corporations with higher CSR rating are likely to have more effective internal control with logistic regression method based on the samples consisting of 16,365 firm-year observations from Audit Analytics database and Kinder, Lydenberg and Domini (KLD) database for the period 2004 to 2013. We also suppose that the moderating role, gender diversity is positively moderates the effect of CSR on internal control effectiveness. We observe that coefficients on CSR are positive and significant for the regression of effective internal control representing that CSR is positively associated with effective internal control. Moreover, we find that gender diversity has a positively significant moderating effect on the relationship between CSR and internal control effectiveness and no prior study has investigated this effect. In conclusion, our results suggest that CSR is positively correlated with effective internal control and gender diversity is positively moderates the relation between CSR and internal control effectiveness.