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Digital transformation of enterprises and greenwashing behavior: evidence from China

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  • Li, Huilian
  • Zhong, Yang

Abstract

This study examines the impact of digital transformation on enterprise greenwashing behavior using data from Chinese-listed firms from 2011 to 2022. Our findings indicate that digital transformation significantly mitigates greenwashing, primarily by improving the information environment and enhancing internal control quality rather than alleviating financing constraints. Further heterogeneity tests show that this effect is more prominent in state-owned enterprises (SOEs), firms in western regions, highly marketized areas, and non-heavily polluting industries. Additionally, digital transformation mainly reduces greenwashing in environmental (E) and social (S) aspects, rather than governance (G). This study enriches the literature on the economic consequences of digital transformation (DT) and provides valuable insights into curbing greenwashing from the perspective of publicly listed firms.

Suggested Citation

  • Li, Huilian & Zhong, Yang, 2025. "Digital transformation of enterprises and greenwashing behavior: evidence from China," Finance Research Letters, Elsevier, vol. 82(C).
    • Handle: RePEc:eee:finlet:v:82:y:2025:i:c:s154461232500844x
    DOI: 10.1016/j.frl.2025.107585
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    References listed on IDEAS

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    1. Chen, Shiyi & Tian, Jiafu & Lu, Juan & Bao, Qiang, 2025. "Can digital collaboration curb corporate greenwashing: A perspective from government-bank-enterprise digital collaboration," Energy Economics, Elsevier, vol. 152(C).
    2. Yu, Hong & Sun, Jialiang & Zhang, Liqin & Deng, Jianguang, 2025. "Network infrastructure and ESG performance: The role of environmental law enforcement," Finance Research Letters, Elsevier, vol. 84(C).
    3. Mingye Ai & Fang Luo & Yan Bu & Ziyu Jiang, 2026. "Non-Linear Insights into Digital Transformation and Corporate Environmental Responsibility: Resource Dependence Theory and Information Search Theory," Journal of the Knowledge Economy, Springer;Portland International Center for Management of Engineering and Technology (PICMET), vol. 17(2), pages 3936-3974, April.
    4. Shuai Che & Miaomiao Tao & Jun Wang & Dongkai Yang, 2026. "Can digital economy strengthen environmental governance? Insights from innovative capacity and vitality," Economic Change and Restructuring, Springer, vol. 59(1), pages 1-29, February.

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