The Relationship Among Corporate Governance, Internal Control, and M&A Performance

SILC Business School, Shanghai University, Shanghai, 200444, China

^* Corresponding author: 3404913680220222@shu.edu.cn

Abstract

With the rapid advancement of economic globalization and the intensification of capital market reforms, mergers and acquisitions (M&A) have become an essential strategic tool for business expansion and industrial improvement. However, the risk of post-M&A integration failure remains a core constraint on value creation. This study employs panel data from Chinese A-share listed companies spanning from 2011 to 2023 to develop a chained model of Corporate Governance-Internal Control-M&A Performance” and empirically investigates the influence of corporate governance on M&A performance, along with the moderating effect of internal control. The result indicates that improved corporate governance has a significant impact on M&A performance. This beneficial impact is more noticeable in companies that have poor M&A performance. Furthermore, superior internal control has a positive moderating effect on the association between increased corporate governance and improved M&A performance. These findings not only theoretically clarify the synergistic mechanism between corporate governance and internal control but also offer practical insights for companies to maximize governance structures, improve internal control systems, and for legislators to strengthen regulatory frameworks.