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The Synergistic Effects of Digital Technology Application and ESG Performance on Corporate Performance

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  • Qi, Yudong
  • Han, Minmin
  • Zhang, Chao

Abstract

We examine the effect of enterprise digital technology applications and ESG performance on enterprise performance. By using textual analysis on hand-collecting data from the annual reports of Chinese Shanghai and Shenzhen A-share listed firms, we portray the extent of digital technology application of enterprise and further find that digital technology application and ESG performance have a significant positive effect on corporate performance, respectively. Besides that, we find that they have a significant synergistic effect on corporate performance, and this effect is particularly significant among firms with higher levels of governance and firms located in eastern China. Therefore, we provide solid theoretical support and insights for promoting the "digitalization and greening synergistic development" strategy for emerging market countries.

Suggested Citation

  • Qi, Yudong & Han, Minmin & Zhang, Chao, 2024. "The Synergistic Effects of Digital Technology Application and ESG Performance on Corporate Performance," Finance Research Letters, Elsevier, vol. 61(C).
    • Handle: RePEc:eee:finlet:v:61:y:2024:i:c:s1544612324000370
    DOI: 10.1016/j.frl.2024.105007
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    1. Yu Sang & Kannan Loganathan & Priya Sukirthanandan, 2025. "A Study on the Impact of Corporate Digital Transformation on Environmental, Social, and Governance (ESG) Performance: Mechanism Analysis Based on Resource Allocation Efficiency and Technological Gap," Sustainability, MDPI, vol. 17(8), pages 1-31, April.
    2. Yang, Yifei & Lyu, Jingyi & Wei, Yajun, 2025. "Big data applications, technological empowerment, and corporate ESG performance," Finance Research Letters, Elsevier, vol. 86(PB).
    3. Jun Li & Ying Wang & Shizhi Liang & Peng Zhou & Ao Zhang, 2025. "Does the National Big Data Comprehensive Experimental Zone Pilot Policy Effectively Promote the ESG Performance of Firms? Evidence From Listed Firms in China," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 46(5), pages 3106-3122, July.
    4. Wang, Chen & Feng, Chunyuan, 2025. "Digital technology and degree of internationalization – The mediating role of supply chain concentration," Finance Research Letters, Elsevier, vol. 85(PA).
    5. Hu, Siyang & Zhang, Chongyan, 2025. "ESG disclosure quality, supply chain resilience, and corporate performance," Finance Research Letters, Elsevier, vol. 85(PE).
    6. Li, Yiping & Zheng, Lanxing & Xie, Chang & Fang, Jiming, 2024. "Big data development and enterprise ESG performance: Empirical evidence from China," International Review of Economics & Finance, Elsevier, vol. 93(PB), pages 742-755.
    7. Hu, Siyang & Zhou, Xingyu & Li, Ping, 2025. "Tax incentives, market competition, and corporate innovation," Finance Research Letters, Elsevier, vol. 77(C).
    8. Chen, Yuhang & Zhong, Yilin & Xu, Feng & Zhang, Qinghua, 2025. "Driving environmental, social, and governance excellence: The direct and indirect effects of intelligent transformation," Structural Change and Economic Dynamics, Elsevier, vol. 75(C), pages 313-331.
    9. Wang, Yang & Wang, Yongheng & Yang, Pengyu, 2025. "Does artificial intelligence impact corporate ESG performance? Evidence from a quasi-natural experiment in China," Energy Economics, Elsevier, vol. 151(C).
    10. Vittorio Laus & Enrico Battisti & Samuel Ribeiro-Navarrete, 2026. "Merging innovation and responsibility: the role of digital M&A in shaping ESG performance," International Entrepreneurship and Management Journal, Springer, vol. 22(2), pages 1-29, June.
    11. Huang, Qianxuan & Gao, Li, 2025. "Technological empowerment: The pathways of artificial intelligence influencing corporate ESG performance," Finance Research Letters, Elsevier, vol. 86(PF).
    12. Hanjin Xie & Fengquan Wu, 2025. "Artificial Intelligence Technology and Corporate ESG Performance: Empirical Evidence from Chinese-Listed Firms," Sustainability, MDPI, vol. 17(2), pages 1-20, January.
    13. Xu, Mengmeng & Wang, Zihao & Zhou, Yanjiao & Wang, Feng & Wu, Zhan, 2025. "Environmental information transparency and firms' sustainable development: Evidence from automatic environment monitoring and information disclosure in China," Energy Economics, Elsevier, vol. 150(C).
    14. Luo Zixu, 2024. "The Impact of Firm Digital Transformation on Environmental, Social, and Governance Performance: Evidence from China," Economics - The Open-Access, Open-Assessment Journal, De Gruyter, vol. 18(1), pages 1-12.
    15. Wang, YiZheng & Zhang, ZhenTian, 2025. "Digital development and rural financial inclusion: Evidence from China," Research in International Business and Finance, Elsevier, vol. 73(PA).

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    JEL classification:

    • G10 - Financial Economics - - General Financial Markets - - - General (includes Measurement and Data)
    • D91 - Microeconomics - - Micro-Based Behavioral Economics - - - Role and Effects of Psychological, Emotional, Social, and Cognitive Factors on Decision Making
    • G40 - Financial Economics - - Behavioral Finance - - - General

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