Research On The Effect Of Top Management On Internal Control Effectiveness

Recent years,the failure of internal control damaged the value and development of enterprises,such as Xiaomi company and Shenghe Pharmaceutical Co.,Ltd.How to improve the effectiveness of internal control is a key issue.Most studies focus on corporate governance,equity structure,and financial condition,while neglecting the senior executives.Therefore,from the perspective of different characteristics of executives,this paper studies its impact mechanism on the effectiveness of internal control of listed companies,and provides relevant suggestions for optimizing the executive team and improving the effectiveness of internal control.Based on the review of relevant literature,this paper finds out the characteristics of executives will affect executives behavior decision,and affect the effectiveness of the internal control.The study found the age tenure education level,age heterogeneity of executive team and effectiveness of internal control were significantly positively correlated;and the education level heterogeneity,tenure heterogeneity has a significant negative correlation with the effectiveness of internal control.Further study found,in the enterprises with different property rights,executives characteristics have different influence on it.Therefore,in order to enhance the effectiveness of internal control,enterprises should establish a mechanism for selecting senior executives,and attach importance to the age and educational background structure of executives.And,enterprises should perfect the appointment system of senior executives,reasonably extend the tenure and organize internal training.In addition,enterprises should also establish appropriate incentive mechanisms to enhance the level of effectiveness of internal control.Then improve the efficiency of corporate governance and business performance,to maximize the value of enterprises.