Does digital transformation reduce China's corporate pollution emission intensity?

Songsheng Mao, Tingfeng Tang and Gongyan Yang

Finance Research Letters, 2025, vol. 78, issue C

Abstract: In light of the Carbon Peaking and Carbon Neutrality Goals established by the Chinese government, the reduction of pollution emission through digitization is crucial for the sustainable development for China's listed enterprises. This paper analyzes the impact of digitalization on enterprise pollution emission, using the expansion of Shapiro's enterprise pollution model. It empirically tests the effects and mechanisms of pollution emission reduction in relation to enterprise digital transformation, based on the estimated pollution emission data from Chinese A-share listed companies between 2008 and 2020. The findings indicate that digital transformation of enterprise can significantly diminish the intensity of enterprises pollution emission, with technological advancement and green innovation serving as the mechanisms by which digitalization achieves pollution reduction. In addition, heterogeneity analysis shows that the digital transformation of state-owned enterprises and heavily polluting industries yields a more significant reduction in pollution, but there is no heterogeneity in the intensity of regional environmental regulations. This paper discusses the strategies for company pollution reduction in the context of digitalization and offers guidance for enterprises to seize on the opportunities presented by technology revolution and green economic transformation.

Keywords: Digital transformation; Pollution emission intensity; Technical progress; Green innovation (search for similar items in EconPapers)
JEL-codes: C12 C36 C51 G18 Q55 (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:finlet:v:78:y:2025:i:c:s1544612325004040

DOI: 10.1016/j.frl.2025.107141

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