The Impact of Corporate Digital Transformation on Sustainable Development in China

Wanyi Chen, Hao Ren and Yanyu Shu

Business Strategy and the Environment, 2025, vol. 34, issue 3, 2721-2747

Abstract: This study examines the relationship between corporate digital transformation (CDT) and environmental, social, and governance (ESG) performance. Based on resource‐based theory, the findings indicate that CDT contributes to ESG performance through six channels: energy saving, discouragement of greenwashing behavior, improvement of technological innovation and social responsibility, alleviation of information asymmetry, and enhancement of risk management. This relationship was more significant under fierce market competition without cyberattacks. This study enriches the literature on the economic impacts of CDT from the perspective of sustainable development and expands the literature on the factors influencing sustainable performance from the perspective of digital technology. It directs the government to advance digital technology, foster a competitive market environment, and enhance cybersecurity, while also serving as a crucial reference for society in driving the reform of CDT, ensuring the sustainable development of the economy and promoting high‐quality and sustainable CDT in developing countries, including China.

Date: 2025
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