The Influencing Mechanism of Internal Control Effectiveness on Technological Innovation: CSR as a Mediator

Xinyuan Wang,Dongphil Chun,Zhenyang Zhang

doi:10.3390/su132313122

Abstract

The study explores the relationship between internal control effectiveness, corporate social responsibility (CSR), and technological innovation. By establishing a mediating effect model, we analyzed the effect of internal control effectiveness on technological innovation. The study selected the data of Chinese A-share listed companies between 2014 and 2019 as the sample. The sources of variable indicators include China Stock Market and Accounting Research (CSMAR), DIB Internal Control database, and Hexun CSR score. The empirical study shows that internal control effectiveness is significantly and positively related to technological innovation. Enhancing internal control effectiveness has a significant positive effect on the fulfillment of corporate social responsibility. In the process of internal control effectiveness on technological innovation, corporate social responsibility functions as a mediating variable and plays a partial mediating role. The study provides empirical data to support listed companies’ emphasis on internal control and active fulfillment of social responsibility, thereby enhancing their technological innovation performance.

Highlights

The topic of enterprises’ technological innovation has been attracting much attention from both academic and practical areas
The results show that the coefficient of the effect of corporate social responsibility (CSR) on technological innovation is 0.0223, which is significantly positive at the 5% level
To explore the relationship between internal control, CSR, and technological innovation, this study analyzes the mechanism of internal control effectiveness on technological innovation by establishing a mediating effect model based on valid investigation samples of Chinese listed companies in Shanghai and Shenzhen A-shares from 2014 to 2019

Summary

Introduction

The topic of enterprises’ technological innovation has been attracting much attention from both academic and practical areas. With the introduction of a series of innovationrelated policies, Chinese industrial development is being transformed and upgraded from the traditional manufacturing mode to the advanced creation mode, putting forward higher requirements on the enterprises’ technological innovation. The Chinese entrepreneurial ecosystem is dominant in terms of knowledge, and the technological innovation of Chinese enterprises has substantial research value. There are significant differences in the degree of technological innovation within Chinese firms, which is an excellent research sample. This study selects Chinese listed companies in order to explore the drivers of technological innovation, which is the key to enhancing firm competitiveness

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Methods

Results

Conclusion