Digital Transformation and Corporate ESG Performance: A Mechanism Test Based on Information Disclosure and Investor Shareholding

Research Article
Open access

Digital Transformation and Corporate ESG Performance: A Mechanism Test Based on Information Disclosure and Investor Shareholding

Qiong Ge 1*
  • 1 School of Economics, Anhui University, Hefei, China    
  • *corresponding author 15056660860@163.com
AEMPS Vol.192
ISSN (Print): 2754-1177
ISSN (Online): 2754-1169
ISBN (Print): 978-1-80590-195-2
ISBN (Online): 978-1-80590-196-9

Abstract

In the context of integrating digital economy and sustainable development, the role of digital transformation in enhancing corporate ESG performance remains a critical research focus. Using panel data from China’s A-share listed companies (2013–2023), this study employs a two-way fixed-effects model to demonstrate that digital transformation significantly improves corporate ESG performance. Endogeneity checks (multi-period DID, instrumental variables) and robustness tests (alternative variables, adding control variables) confirm the validity of the findings. Mechanism analysis identifies ESG disclosure quality as a mediating factor, while the shareholding ratio of ESG investors exhibits a "double-edged sword" effect. Behaviors such as "greenwashing" and conflicting objectives can weaken the positive impact of digital transformation on corporate ESG performance. Heterogeneous analysis further reveals that the ESG-enhancing effect is more pronounced in state-owned enterprises (SOEs) and industries with high environmental sensitivity, with SOEs benefiting from policy incentives and resource advantages, and environmentally sensitive industries achieving emission reductions and process optimization through digital technology. This study provides theoretical and practical evidence for policymakers to promote technological innovation, refine the ESG institutional framework, and guide the sustainable allocation of capital.

Keywords:

digital transformation, ESG performance, disclosure quality, investor ownership Introduction

Ge,Q. (2025). Digital Transformation and Corporate ESG Performance: A Mechanism Test Based on Information Disclosure and Investor Shareholding. Advances in Economics, Management and Political Sciences,192,58-70.
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References

[1]. ZHANG Yongji,ZHAI Jianqiao,ZHU Yaxuan,et al. How digital transformation affects corporate ESG performance[J]. Journal of China University of Geosciences (Social Science Edition),2023,23(06):126-141.

[2]. HU Jie,HAN Yiming,ZHONG Yong. How Corporate Digital Transformation Affects Corporate ESG Performance-Evidence from Listed Companies in China[J]. Industrial Economics Review,2023,(01):105-123.

[3]. KUANG Zengjie,Zhou Xindi . Research on the impact of digital transformation on corporate ESG performance[J]. Journal of Shanghai University of International Business and Economics,2025,32(01):34-50.

[4]. DU Chuanzhong,Li Zehao. Research on the impact of digital transformation on corporate ESG performance[J]. East China Economic Management,2024,38(07):91-102.

[5]. ZHOU Xuefeng,WANG Daying,ZHANG Jing. Digital transformation, green innovation sustainability and corporate ESG performance[J]. Friends of Accounting,2025,(03):100-109.

[6]. YANG Kaijun,WANG Dan. Research on the impact of enterprise digital transformation on ESG performance--an empirical analysis based on new energy listed companies in China[J]. Industrial Technology and Economics,2024,43(12):83-91.

[7]. CHEN Lifeng,CAO Weizhou,CHEN Yifan. The driving mechanism and path of corporate digital transformation on ESG performance - a test based on the meMO-II model[J]. Statistics and Decision Making,2025,41(04):172-177.

[8]. SUN Qian,YIN Meiqun. Can improving internal control quality reduce corporate ESG rating divergence[J]. Scientific Decision Making,2024,(10):16-34.

[9]. HAN Zhongxue,ZHANG Ying. Digital Transformation and ESG Performance-An Analysis of Mediation Mechanism Based on Information Transparency and Total Factor Productivity[J]. Modern Management Science,2023,(03):141-150.

[10]. YANG Wansu,Ye Mingdan.Will ESG disclosure alleviate corporate finance constraints? --The moderating effect based on digital inclusive finance[J]. Finance and accounting newsletter,2023,(18):42-47.

[11]. Zhu F, Fan H, Zheng Z. The Disclosure Fog: Institutional Investors and Corporate Greenwashing[J]. International Journal of Finance & Economics, 2025.

[12]. Kim S, Yoon A. Analyzing active fund managers’ commitment to ESG: Evidence from the United Nations Principles for Responsible Investment[J]. Management science, 2023, 69(2): 741-758.

[13]. ZHAO Chenyu,WANG Wenchun,LI Xuesong. How digital transformation affects enterprise total factor productivity[J]. Finance and Trade Economics,2021,42(07):114-129.

[14]. XIE Hongjun,Lv Xue. Responsible international investment: ESG and China's OFDI[J]. Economic Research,2022,57(03):83-99.

[15]. ZHANG Leiyun,XU Yufan,XU Peng. The Impact of Board Independence on the Quality of Corporate ESG Disclosure[J]. Friends of Accounting,2025,(01):80-86.

[16]. WU Fei,HU Huizhi,LIN Huiyan,et al. Corporate digital transformation and capital market performance-empirical evidence from stock liquidity[J]. Management World,2021,37(07):130-144+10.

[17]. CHEN Wen,CHANG Qi. Has big data empowered enterprise green innovation--a quasi-natural experiment based on a national-level big data comprehensive pilot zone[J]. Financial Science,2022,(08):76-92.

[18]. XIAO Hongjun,YANG Zhen,LIU Meiyu. The social responsibility promotion effect of corporate digitalization: a test of internal and external dual paths[J]. Economic Management,2021,43(11):52-69.

[19]. WEN Zhonglin,YE Baojuan. Mediation effects analysis:Methods and model development[J]. Advances in Psychological Science,2014,22(05):731-745.

[20]. JIANG Ting. Mediating and moderating effects in empirical studies of causal inference[J]. China Industrial Economy,2022,(05)

Cite this article

Ge,Q. (2025). Digital Transformation and Corporate ESG Performance: A Mechanism Test Based on Information Disclosure and Investor Shareholding. Advances in Economics, Management and Political Sciences,192,58-70.

Data availability

The datasets used and/or analyzed during the current study will be available from the authors upon reasonable request.

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Volume title: Proceedings of ICMRED 2025 Symposium: Effective Communication as a Powerful Management Tool

ISBN：978-1-80590-195-2(Print) / 978-1-80590-196-9(Online)
Editor：Lukáš Vartiak
Conference website: https://2025.icmred.org/Bratislava.html
Conference date: 30 May 2025
Series: Advances in Economics, Management and Political Sciences
Volume number: Vol.192
ISSN：2754-1169(Print) / 2754-1177(Online)

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References

[1]. ZHANG Yongji,ZHAI Jianqiao,ZHU Yaxuan,et al. How digital transformation affects corporate ESG performance[J]. Journal of China University of Geosciences (Social Science Edition),2023,23(06):126-141.

[2]. HU Jie,HAN Yiming,ZHONG Yong. How Corporate Digital Transformation Affects Corporate ESG Performance-Evidence from Listed Companies in China[J]. Industrial Economics Review,2023,(01):105-123.

[3]. KUANG Zengjie,Zhou Xindi . Research on the impact of digital transformation on corporate ESG performance[J]. Journal of Shanghai University of International Business and Economics,2025,32(01):34-50.

[4]. DU Chuanzhong,Li Zehao. Research on the impact of digital transformation on corporate ESG performance[J]. East China Economic Management,2024,38(07):91-102.

[5]. ZHOU Xuefeng,WANG Daying,ZHANG Jing. Digital transformation, green innovation sustainability and corporate ESG performance[J]. Friends of Accounting,2025,(03):100-109.

[6]. YANG Kaijun,WANG Dan. Research on the impact of enterprise digital transformation on ESG performance--an empirical analysis based on new energy listed companies in China[J]. Industrial Technology and Economics,2024,43(12):83-91.

[7]. CHEN Lifeng,CAO Weizhou,CHEN Yifan. The driving mechanism and path of corporate digital transformation on ESG performance - a test based on the meMO-II model[J]. Statistics and Decision Making,2025,41(04):172-177.

[8]. SUN Qian,YIN Meiqun. Can improving internal control quality reduce corporate ESG rating divergence[J]. Scientific Decision Making,2024,(10):16-34.

[9]. HAN Zhongxue,ZHANG Ying. Digital Transformation and ESG Performance-An Analysis of Mediation Mechanism Based on Information Transparency and Total Factor Productivity[J]. Modern Management Science,2023,(03):141-150.

[10]. YANG Wansu,Ye Mingdan.Will ESG disclosure alleviate corporate finance constraints? --The moderating effect based on digital inclusive finance[J]. Finance and accounting newsletter,2023,(18):42-47.

[11]. Zhu F, Fan H, Zheng Z. The Disclosure Fog: Institutional Investors and Corporate Greenwashing[J]. International Journal of Finance & Economics, 2025.

[12]. Kim S, Yoon A. Analyzing active fund managers’ commitment to ESG: Evidence from the United Nations Principles for Responsible Investment[J]. Management science, 2023, 69(2): 741-758.

[13]. ZHAO Chenyu,WANG Wenchun,LI Xuesong. How digital transformation affects enterprise total factor productivity[J]. Finance and Trade Economics,2021,42(07):114-129.

[14]. XIE Hongjun,Lv Xue. Responsible international investment: ESG and China's OFDI[J]. Economic Research,2022,57(03):83-99.

[15]. ZHANG Leiyun,XU Yufan,XU Peng. The Impact of Board Independence on the Quality of Corporate ESG Disclosure[J]. Friends of Accounting,2025,(01):80-86.

[16]. WU Fei,HU Huizhi,LIN Huiyan,et al. Corporate digital transformation and capital market performance-empirical evidence from stock liquidity[J]. Management World,2021,37(07):130-144+10.

[17]. CHEN Wen,CHANG Qi. Has big data empowered enterprise green innovation--a quasi-natural experiment based on a national-level big data comprehensive pilot zone[J]. Financial Science,2022,(08):76-92.

[18]. XIAO Hongjun,YANG Zhen,LIU Meiyu. The social responsibility promotion effect of corporate digitalization: a test of internal and external dual paths[J]. Economic Management,2021,43(11):52-69.

[19]. WEN Zhonglin,YE Baojuan. Mediation effects analysis:Methods and model development[J]. Advances in Psychological Science,2014,22(05):731-745.

[20]. JIANG Ting. Mediating and moderating effects in empirical studies of causal inference[J]. China Industrial Economy,2022,(05)

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