IDEAS home Printed from https://ideas.repec.org/a/gam/jsusta/v16y2024i10p3956-d1390988.html
   My bibliography  Save this article

Can Digital Economy Development Facilitate Corporate ESG Performance?

Author

Listed:
  • Jiayang Kong

    (College of Computer and Information Science, Qinghai University of Science and Technology, Xining 810016, China
    Department of Computer Technology and Applications, Qinghai University, Xining 810016, China
    School of Marxism, Beijing Normal University, Beijing 100875, China)

  • Mark Goh

    (NUS Business School & The Logistics Institute-Asia Pacific, National University of Singapore, Singapore 119613, Singapore)

  • Yu Cao

    (School of Economics and Business Administration, Central China Normal University, Wuhan 430079, China)

Abstract

As ESG (environmental, social, and corporate governance) is consistent with the spirit of sustainable development, it is useful to elevate ESG performance to realize the sustainable development of enterprise and society. Using the data of Chinese A-share listed firms in the period of 2011 to 2019, this paper takes the National Big Data Comprehensive Pilot Zone policy as a quasi-natural experiment and uses the difference-in-differences method to assess the effect of digital economy development on ESG performance. This paper reveals the following: (1) the digital economy can facilitate ESG performance; (2) digitalization of the economy helps enterprises to propel digital transformation, which in turn lifts ESG performance; (3) digital economy development has a deeper impact on private enterprises, especially for those in China’s capital cities; and (4) digital economy development moderates the inhibiting effect of ESG performance on corporate financial constraints. The findings of this paper indicate that digitalization of the economy can help to achieve sustainable development.

Suggested Citation

  • Jiayang Kong & Mark Goh & Yu Cao, 2024. "Can Digital Economy Development Facilitate Corporate ESG Performance?," Sustainability, MDPI, vol. 16(10), pages 1-15, May.
    • Handle: RePEc:gam:jsusta:v:16:y:2024:i:10:p:3956-:d:1390988
    as

    Download full text from publisher

    File URL: https://www.mdpi.com/2071-1050/16/10/3956/pdf
    Download Restriction: no
    File URL: https://www.mdpi.com/2071-1050/16/10/3956/
    Download Restriction: no
    ---><---

    References listed on IDEAS

    as
    1. Jacobson, Louis S & LaLonde, Robert J & Sullivan, Daniel G, 1993. "Earnings Losses of Displaced Workers," American Economic Review, American Economic Association, vol. 83(4), pages 685-709, September.
    2. Raj Chetty & Adam Looney & Kory Kroft, 2009. "Salience and Taxation: Theory and Evidence," American Economic Review, American Economic Association, vol. 99(4), pages 1145-1177, September.
    3. Lin, Xudong & Zhu, Hao & Meng, Yiqun, 2023. "ESG greenwashing and equity mispricing: Evidence from China," Finance Research Letters, Elsevier, vol. 58(PD).
    4. Roland Bénabou & Jean Tirole, 2010. "Individual and Corporate Social Responsibility," Economica, London School of Economics and Political Science, vol. 77(305), pages 1-19, January.
    5. Yu, Ellen Pei-yi & Luu, Bac Van & Chen, Catherine Huirong, 2020. "Greenwashing in environmental, social and governance disclosures," Research in International Business and Finance, Elsevier, vol. 52(C).
    6. HUO, Peng & WANG, Luxin, 2022. "Digital economy and business investment efficiency: Inhibiting or facilitating?," Research in International Business and Finance, Elsevier, vol. 63(C).
    7. Baker, Andrew C. & Larcker, David F. & Wang, Charles C.Y., 2022. "How much should we trust staggered difference-in-differences estimates?," Journal of Financial Economics, Elsevier, vol. 144(2), pages 370-395.
    8. Goodman-Bacon, Andrew, 2021. "Difference-in-differences with variation in treatment timing," Journal of Econometrics, Elsevier, vol. 225(2), pages 254-277.
    9. Liu, Jingling & Chen, Yanying & Liang, Feng Helen, 2023. "The effects of digital economy on breakthrough innovations: Evidence from Chinese listed companies," Technological Forecasting and Social Change, Elsevier, vol. 196(C).
    10. Tu, Meng & Zhang, Bing & Xu, Jianhua & Lu, Fangwen, 2020. "Mass media, information and demand for environmental quality: Evidence from the “Under the Dome”," Journal of Development Economics, Elsevier, vol. 143(C).
    11. Tu, Zhengge & Hu, Tianyang & Shen, Renjun, 2019. "Evaluating public participation impact on environmental protection and ecological efficiency in China: Evidence from PITI disclosure," China Economic Review, Elsevier, vol. 55(C), pages 111-123.
    12. Tao, Jiancong & Wang, Zhe & Xu, Yujie & Zhao, Boyu & Liu, Jiaqi, 2024. "Can the digital economy boost rural residents’ income? Evidence from China based on the spatial Durbin model," Economic Analysis and Policy, Elsevier, vol. 81(C), pages 856-872.
    13. Hunjra, Ahmed Imran & Zhao, Shikuan & Goodell, John W. & Liu, Xiaoqian, 2024. "Digital economy policy and corporate low-carbon innovation: Evidence from a quasi-natural experiment in China," Finance Research Letters, Elsevier, vol. 60(C).
    14. Wang, Kai & Li, Tingting & San, Ziyao & Gao, Hao, 2023. "How does corporate ESG performance affect stock liquidity? Evidence from China," Pacific-Basin Finance Journal, Elsevier, vol. 80(C).
    15. Lange, Steffen & Pohl, Johanna & Santarius, Tilman, 2020. "Digitalization and energy consumption. Does ICT reduce energy demand?," Ecological Economics, Elsevier, vol. 176(C).
    Full references (including those not matched with items on IDEAS)

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Yuan, Huaxi & Zou, Longhui & Feng, Yidai, 2023. "How to achieve emission reduction without hindering economic growth? The role of judicial quality," Ecological Economics, Elsevier, vol. 209(C).
    2. Brick, Kerri & De Martino, Samantha & Visser, Martine, 2023. "Behavioural nudges for water conservation in unequal settings: Experimental evidence from Cape Town," Journal of Environmental Economics and Management, Elsevier, vol. 121(C).
    3. Wang, Ruqi & Xu, Pei & Gao, Honggui, 2024. "Rectifying local governments’ strategic environmental enforcement: Can refined air pollution monitoring enhance local air quality in China?," Economic Analysis and Policy, Elsevier, vol. 84(C), pages 978-995.
    4. Dong, Siyuan & Wang, Na & Fan, Chengwei & Chen, Shi & Zhang, Lei, 2024. "E-commerce and rural women entrepreneurship ——Based on the quasi-natural experiment of “comprehensive demonstration policy” for E-commerce in rural areas," Economic Analysis and Policy, Elsevier, vol. 83(C), pages 749-765.
    5. Upward, Richard & Wright, Peter W., 2024. "Income shocks, political support and voting behaviour," Journal of Public Economics, Elsevier, vol. 239(C).
    6. Xufei Zhang & Hongsheng Fang & Lin Guo, 2023. "Corporate Endowment Insurance Fee Reduction and Employee Wages: Evidence from China," China & World Economy, Institute of World Economics and Politics, Chinese Academy of Social Sciences, vol. 31(2), pages 192-222, March.
    7. He, Eric & Jacob, Martin & Vashishtha, Rahul & Venkatachalam, Mohan, 2022. "Does differential taxation of short-term relative to long-term capital gains affect long-term investment?," Journal of Accounting and Economics, Elsevier, vol. 74(1).
    8. Chang, Dingyi & Zhang, Ning, 2024. "The effect of cultural system reform on tourism development: Evidence from China," Structural Change and Economic Dynamics, Elsevier, vol. 70(C), pages 77-90.
    9. Wang, Zhenxuan & Zhang, Junjie, 2023. "The value of information disclosure: Evidence from mask consumption in China," Journal of Environmental Economics and Management, Elsevier, vol. 122(C).
    10. Wu, Xiting & Luo, Le & You, Jiaxing, 2023. "Actions speak louder than words: Environmental law enforcement externalities and access to bank loans," Journal of Banking & Finance, Elsevier, vol. 153(C).
    11. Conor Lennon & Johanna Catherine Maclean & Keith F. Teltser, 2024. "Ridesharing and Substance Use Disorder Treatment," NBER Working Papers 33077, National Bureau of Economic Research, Inc.
    12. Wang, Xue & Liu, Qingyuan, 2024. "Information disclosure and ESG rating disagreement: Evidence from green bond issuance in China," Pacific-Basin Finance Journal, Elsevier, vol. 85(C).
    13. Lennon, Conor & Maclean, Johanna Catherine & Teltser, Keith, 2025. "Ridesharing and substance use disorder treatment," Journal of Health Economics, Elsevier, vol. 99(C).
    14. Cheng, Yuhong & Ma, Ben & Sun, Yidan, 2023. "Does central ecological transfer payment enhance local environmental performance? Quasi-experimental evidence from China," Ecological Economics, Elsevier, vol. 212(C).
    15. Zhou, Tao & Huang, Xuhui & Zhang, Ning, 2023. "The effect of innovation pilot on carbon total factor productivity: Quasi-experimental evidence from China," Energy Economics, Elsevier, vol. 125(C).
    16. Yuan, Deyu & Du, Junying & Chang, Jiaming, 2024. "Does transport infrastructure development inhibit firm-level employment fluctuations? Evidence from national expressway construction in China," Economic Analysis and Policy, Elsevier, vol. 84(C), pages 610-627.
    17. Niu, Geng & Jin, XiaoShu & Wang, Qi & Zhou, Yang, 2022. "Broadband infrastructure and digital financial inclusion in rural China," China Economic Review, Elsevier, vol. 76(C).
    18. Tan, Ruipeng & Cai, Qijun & Pan, Lulu, 2024. "Faking for fortune: Emissions trading schemes and corporate greenwashing in China," Energy Economics, Elsevier, vol. 130(C).
    19. Chu, Yin & Holladay, J. Scott & Qiu, Yun & Tian, Xian-Liang & Zhou, Maigeng, 2023. "Air pollution and mortality impacts of coal mining: Evidence from coalmine accidents in China," Journal of Environmental Economics and Management, Elsevier, vol. 121(C).
    20. Huang, Chenchen & Luo, Di & Mukherjee, Soumyatanu & Mishra, Tapas, 2022. "To Acquire or to Ally? Managing Partners’ Environmental Risk in International Expansion," MPRA Paper 117591, University Library of Munich, Germany, revised 07 Jan 2023.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:gam:jsusta:v:16:y:2024:i:10:p:3956-:d:1390988. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: MDPI Indexing Manager (email available below). General contact details of provider: https://www.mdpi.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.