An Study About Theimpact Of Corporate Governance And Corporate Social Responsibility On Financial Performance

In recent years,with the steady development of economy,the enterprise,a basic part of the market,focus even more on it's self sustainability aside from maximizing the profit.Corporate governance and it's social responsibility is the major factor of corporate long term development.Despite the fact that our corporates are paying extra attention on improving their governance and the implementation of interested parties' social responsibility,they shared several different level of corporate governance and their social responsibility reports also vary differently.At this moment,theoretical circles also pay close attention on the influence of corporate governance and it's social responsibility on corporate.Most scholars put social responsibility into existing corporate governance structure as external force.Take the view of corporate sustainability,social responsibility can deduce the non-systematic risk efficiently and increase the positive effect of improving corporate governance structure on financial performance.Therefore,the research of the impact of corporate governance and corporate social responsibility on financial performance is very necessary.This article is aiming on providing the theoretical basis to the research.On the basis of studying previous research results and basic theoretical analysis,this article did the research of corporate governance and corporate social responsibility on financial performance.It divided the corporate financial performance into two different parts.The short-term financial performance reflects the corporate financial crisis and the long-term financial performance reflects the corporate market value.Using companies in Shenzhen and Shanghai main board who have disclosed corporate social responsibility report in 2014 as the research object,I have constructed a model about the corporate governance and corporate social responsibility on financial performance to carry out the research.First,I used model I and model II to examine the impact of corporate governance on short-term financial performance and long-term financial performance,then added corporate social responsibility in model ? and ?,compared to model ? and model ?,testing whether it can be enhanced the positive impact of corporate governance on short-term financial performance and long-term financial performance.The result shows:Independent directors proportion and the size of the supervisory board and the balance system of stock are negatively correlated with short-term financial performance,but they are positive correlated with long-term financial performance.The top three executives total compensation is significantly positive correlated with short-term and long-term financial performance.Taking the view of corporate sustainability,corporate should also pay attention to the fulfillment of social responsibility and improve their own management structure to maintain their development while seeking their profit.