The Impact Of Corporate Social Risk Control And Internal Control Quality On Financial

In recent years, Leather Yoghourt, the Plasticizer Storm, Fast-growing Chicken, Manipulation Scandal, Pesticide Residue Scandal and so on came to light frequently. Food safety incidents have once again became the focus of attention. There is a main reason of the growing food safety problems is that lacking of the Corporate Society Responsibility and the weak internal control eventually lead to social risk events.Corporate social risk, one of the risks which faced by enterprises, refers to the companies fail to perform its social responsibilities to undertake the extra losses during the business activities. It, mainly comes from neglecting social responsibility strategy and operational decision, will not only bring harm to the community and the environment, but also make an extra loss for the company. Food enterprises to achieve a single goal of maximizing shareholder value, sometimes may ignore the risk control to appear such as food quality and safety incident and serious environmental pollution problems. Various risks in the process of operation and management is the basis of the internal control emergence and development, and also the risk-oriented internal control object. For enterprise social risk control, the effective internal control mechanism has played a positive role to achieve its own value.The relationship between CSR and Corporate Financial Performance, and the relationship between internal control and Corporate Financial Performance have become the focus of current empirical researches. However, no such empirical study on the food and beverage corporations has come into existence at home.This paper researched food and beverage processing enterprises listed for2009-2012in Shanghai Stock Exchange and the Shenzhen Stock Exchange, trying to empirical test the relationship between corporate social risk control, internal controls quality and financial performance and discuss the mechanism of interaction between corporate social responsibility and internal control to find out the necessary connection to deepen enterprise understanding of social responsibility and internal control and promote the healthy development of companies, ensure the China’s food and beverage processing enterprises and society smooth development. The conclusions can be drawn as follows:in the long term, the relationship between corporate social risk controls and financial performance is a positive correlation; company’s internal control can significantly improve the quality of financial performance; when the variables of social responsibility and internal control variables into the model at the same time, the influence on financial performance of internal control is significantly falling, which indicates that social responsibility acts as the mediator between them.