Anti-corruption,Internal Control And Corporate Innovation

At present,China is undergoing an important period of economic transformation.and the market is fiercely competitive.In order to survive and develop in this environment,enterprise,as a microscopic subject,must give sufficient attention to innovation.Executives,as the makers of corporate strategic decisions,control the lifeblood of corporate innovation.The preferences of resource managers and the choice of their growth methods will be influenced by the political environment.Therefore,the external political environment or slight changes will affect the behavior of managers,and then have a major impact on the innovation of enterprises.It is precisely because of the environment of economic transition,which the institutional environment needs to be perfected,that corruption phenomena such as over-consumption of corporate executives and eating,drinking by government officials flourish.Prevalent duty crimes in the current society and government-dominated consciousness twist market resource principles,which has led to a distortion of the company's development philosophy.Therefore enterprise is more willing to promote enterprise development through political rent-seeking rather than innovation strategy,which in turn suppresses the enterprise's willingness to innovate.This has severely undermined the company's innovation and development.However,since the 18 th National Party Congress,a series of measures such as the "eight regulations","six prohibitions" and "tiger flies" have come one after another.A series of high-pressure anti-corruption campaigns have started.At the same time,the Central Government reorganized the Central Inspection Team to rectify the corruption of state-owned enterprise executives and government officials.A large number of government officials and state-owned enterprise executives were investigated for corruption and severely cracked down on the informality between government and enterprises.Political connections and corporate innovation are two alternatives for Chinese companies in the context of transition(Dali et al.,2015).Under such strong anti-corruption efforts,the cost of alternative approaches to corporate innovation will inevitably increase.Will this force Enterprises to choose innovation strategy? This provides a good opportunity for this study.This article takes all A-share listed companies from 2011 to 2015 as the research object,applying the double difference method and studying the impact of the macro-policy of anti-corruption on the innovation of micro-entrepreneurs from the perspective of eating and drinking corruption,than it adds the internal control as a regulatory variable to study the relationship between anti-corruption,internal control and corporate innovation.The empirical results show that:(1)Anti-corruption has a more pronounced effect on the innovation of enterprises with high levels of food and drink corruption.Further research shows that anti-corruption play a more important role in corporate innovation in non-state-owned enterprises that have a higher degree of corruption.(b)Internal control,as an internal oversight mechanism,effectively curb corporate corruption and help promote corporate innovation.(III)Internal control has a strong regulatory role in the relationship between anti-corruption and corporate innovation.Compared with companies with higher levels of internal control,anti-corruption has a greater impact on corporate innovation in companies with low levels of internal control,and this regulatory effect is more pronounced in non-state-owned enterprises.