Research On The Impact Of CEO Characteristics On The Quality Of Internal Control In Listed Companies

Since the publication of the Sarbanes-Oxley Act in 2002,the role of corporate governance has been increasingly valued by academics and practitioners.Enterprises around the world are also aware of the importance of internal control,so they have begun to establish their own internal control system to improve the level of enterprise risk management and enhance the efficiency of enterprise management.Unsurprisingly,many Chinese scholars also joined the internal-control related research.In 2008,the Ministry of Finance in conjunction with the other four departments established the "basic norms of internal control." Although the normative internal control system helps enterprises establish their basic system,meanwhile,many enterprises have been gradually improve their internal control system,many phenomenon of internal-control failure exists,such as the Great Northern Wilderness and the Fusheng financial fraud,Hainan sea bribery and other issues.As we all know,management is the core about establishing and implementing internal control system,and the CEO is the core of management,so the study of CEO characteristics on the quality of internal control of the enterprise will help understanding the relationship between the two,Improving the internal-control quality of the enterprise.First of all,the study begins with the domestic and foreign research and give the summary of the relevant research.Then base on the principal-agent theory,high-level echelon theory and corporate governance theory of management,the study analyses that the CEO characteristics can determine their decision-making,so as to influence the quality of internal control.Moreover,this paper builds seven hypotheses,choosing CEO age,the CEO gender,the CEO degree,the CEO term,the CEO power,the CEO holding and the CEO salary as the explanatory variable,and establishes the model.Then,the data of listed companies in Shanghai and Shenzhen in 2013-2015 were used as samples to carry out descriptive statistics,correlation analysis,multiple regression analysis and robustness test.The empirical research found that the CEO characteristics have a significant impact on the quality of internal control;The CEO term and academic qualifications are positively correlated with the quality of internal control;The holding status and salary level are also positively correlated with the quality ofinternal control;CEO power and internal control have significant Negative correlation;Age and gender have no significant effect on the quality of internal control.