Enterprise digitalization, organizational slack, and green innovation

Min Liu, Xiang Huang, Peicheng Wang and Yuting Liao

International Review of Economics & Finance, 2025, vol. 103, issue C

Abstract: Enterprise green innovation demands substantial resource investments, digitalization emerges as a pivotal enabler that reconfigures organizational resource allocation to drive sustainable innovation. Leveraging panel data from Chinese A-share listed companies (2013–2023), this study empirically investigates how digitalization synergizes with organizational slack to enhance green innovation, testing whether it achieves dual economic-environmental gains within a sustainable development framework. Key findings reveal that: Enterprise digitalization significantly boosts both the quantity and quality of green innovation, optimizing resource utilization efficiency while reducing environmental footprints, thereby aligning with core sustainable development goals; Mechanism analysis demonstrates that digitalization augments resource flexibility and adaptability, with absorbed slack and unabsorbed slack serving as critical mediators to amplify green innovation capacity; Heterogeneity tests indicate stronger effects among firms with high environmental protection investments, pollution-intensive industries, and state-owned enterprises (SOEs). This research provides novel empirical evidence on the digital-green innovation nexus, offering strategic insights for optimizing organizational resources and aligning innovation allocation with sustainable development imperatives.

Keywords: Enterprise digitalization; Organizational slack; Enterprise green innovation; Sustainable development; Sustainability-oriented green transformation (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:eee:reveco:v:103:y:2025:i:c:s1059056025006069

DOI: 10.1016/j.iref.2025.104443

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