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Can digital transformation help alleviate corporate financial redundancy?

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  • Lu, Meiling
  • Han, Qingchi
  • Hao, Qingmin

Abstract

This paper examines the relationship between digital transformation and corporate financial redundancy. Based on listed firms from 2011 to 2023, this paper adopts a two-fixed model to explore digital transformation's effects and underlying mechanisms on corporate financial redundancy. The findings reveal that digital transformation can effectively reduce financial redundancy, and the impact is achieved by improving internal control management and information disclosure quality and alleviating executives’ agency costs. Heterogeneous analysis explores how enterprises’ ownership and life cycle affect different policy effects. Specifically, non-state-owned firms and firms that are growing and maturing benefit more from digital transformation. The findings offer valuable insights for the government in formulating policies related to digitization and for firms in implementing digital transformation.

Suggested Citation

  • Lu, Meiling & Han, Qingchi & Hao, Qingmin, 2025. "Can digital transformation help alleviate corporate financial redundancy?," International Review of Economics & Finance, Elsevier, vol. 97(C).
    • Handle: RePEc:eee:reveco:v:97:y:2025:i:c:s1059056024007640
    DOI: 10.1016/j.iref.2024.103772
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    References listed on IDEAS

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