This study aimed to investigate the effect of internal resources on business performance with emphasis on the mediator role of quality of participation in companies in the industrial city of Sanandaj. Instruments of this study was a questionnaire. Lahiri and Kedya questionnaire was used to examine internal resources and Quality of participation. Inge Wu and Long Le (2012) questionnaire was used to assess business performance. Statistical society of this research comprised of companies based in Sanandaj industrial city. 117 subjects were randomly selected as sample. Cronbach's alpha was used to determine the reliability. The results of the research showed the power of the instruments to gather information. For statistical analysis, descriptive and inferential statistical methods were used. This information were analyzed in SPSS and Lisrel software by applying appropriate statistical tests with respect to this research. Accordingly, the results indicate significant positive relationship between human capitals, organizational capital and the ability to manage the quality of participation. Also, a positive correlation was observed between the quality of participation and business performance significantly.
