How ESG and Digitalization Drive High-Quality Enterprise Development: Evidence from China

Zheng Xue, Kaili Li, Qi Ban and Jialing Li ()
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Zheng Xue: School of Finance, Nankai University, Tianjin 300350, China
Kaili Li: School of Economics, University of International Business and Economics, Beijing 100029, China
Qi Ban: School of Finance, Nankai University, Tianjin 300350, China
Jialing Li: School of Business Administration, Hunan University of Technology and Business, Changsha 410205, China

Sustainability, 2025, vol. 17, issue 11, 1-27

Abstract: The ESG performance of enterprises is congruent with contemporary development concepts and plays a pivotal role in promoting enterprises to achieve high-quality development. The present study commences with an evaluation of the high-quality development of firms across multiple dimensions. It then undertakes an empirical investigation into the impact of ESG performance on the high-quality development of firms. This study utilises data from Chinese A-share listed firms from 2010 to 2023. The findings indicate that ESG performance has the capacity to encourage firms to advance towards high-quality development. Digital transformation is identified as a significant factor that positively moderates the facilitating effect of ESG performance on firms. The mechanism of action of ESG performance involves enhancing supply chain stability and alleviating financing constraints. Furthermore, evidence suggests that ESG performance tends to be heterogeneous in its contribution to the high-quality development of enterprises, with more significant facilitating effects for state-owned enterprises and firms in regions with favourable business environments. The present study offers theoretical and practical empirical support for the establishment of an ESG system that is suitable for China’s national conditions and that will promote high-quality firm development.

Keywords: digital transformation; ESG performance; high-quality development of firms; TFP (search for similar items in EconPapers)
JEL-codes: O13 Q Q0 Q2 Q3 Q5 Q56 (search for similar items in EconPapers)
Date: 2025
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