IDEAS home Printed from https://ideas.repec.org/a/pal/palcom/v11y2024i1d10.1057_s41599-024-04135-6.html
   My bibliography  Save this article

Can digital finance curb corporate ESG decoupling? Evidence from Shanghai and Shenzhen A-shares listed companies

Author

Listed:
  • Hua Liu

    (Nanjing Audit University)

  • Juncheng Wang

    (Nanjing Audit University)

  • Mengna Liu

    (Nanjing Audit University)

Abstract

As green development gains traction, digital finance, a major engine of the economy, plays a conducive role in improving green total factor productivity. Against this backdrop, avoiding corporate ESG decoupling is essential in the pursuit of green and quality development of enterprises. With data from Shanghai and Shenzhen A-share listed companies from 2016 to 2022, this study explores the impact of digital finance on corporate ESG decoupling, and the findings reveal that digital finance can suppress corporate ESG decoupling, and the effect is significant at the 1% level. Specifically, digital finance curbs corporate ESG decoupling by alleviating financing restraints on enterprises, increasing investment efficiency, improving the quality of information disclosure, and minimizing managerial myopia; the effect is more pronounced in non-state-owned enterprises, high-tech enterprises, and heavy-polluting enterprises; second, investor attention positively moderates the effect of digital finance on corporate ESG decoupling. The research findings are expected to provide an empirical basis and policy recommendations to allow digital finance to play a more effective role in leading enterprises to healthy and quality development.

Suggested Citation

  • Hua Liu & Juncheng Wang & Mengna Liu, 2024. "Can digital finance curb corporate ESG decoupling? Evidence from Shanghai and Shenzhen A-shares listed companies," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-15, December.
    • Handle: RePEc:pal:palcom:v:11:y:2024:i:1:d:10.1057_s41599-024-04135-6
    DOI: 10.1057/s41599-024-04135-6
    as

    Download full text from publisher

    File URL: http://link.springer.com/10.1057/s41599-024-04135-6
    File Function: Abstract
    Download Restriction: Access to full text is restricted to subscribers.
    File URL: https://libkey.io/10.1057/s41599-024-04135-6?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Béatrice Parguel & Florence Benoît-Moreau & Cristel Russell, 2015. "Can evoking nature in advertising mislead consumers? The power of ‘executional greenwashing'," Post-Print hal-01463025, HAL.
    2. Zhou, Kuo & Qu, Zhi & Liang, Jiayang & Tao, Yunqing & Zhu, Mengting, 2024. "Threat or shield: Environmental administrative penalties and corporate greenwashing," Finance Research Letters, Elsevier, vol. 61(C).
    3. Yu-Shan Chen & Ching-Hsun Chang, 2013. "Greenwash and Green Trust: The Mediation Effects of Green Consumer Confusion and Green Perceived Risk," Journal of Business Ethics, Springer, vol. 114(3), pages 489-500, May.
    4. Yang, Sen & Xu, Jiawei & Lei, Tianyi & Wang, Mengdi, 2024. "How to improve the efficiency of green development? The role of digital finance," Finance Research Letters, Elsevier, vol. 63(C).
    5. Maria Demertzis & Silvia Merler & Guntram B Wolff, 2018. "Capital Markets Union and the Fintech Opportunity," Journal of Financial Regulation, Oxford University Press, vol. 4(1), pages 157-165.
    6. Hongyi Wang & Yi Li & Bingyang He, 2024. "Spatial Spillover Effects of Digital Finance on Corporate ESG Performance," Sustainability, MDPI, vol. 16(16), pages 1-20, August.
    7. Xue, Qing & Liu, Xiangqin, 2024. "Can digital finance boost corporate green innovation," Finance Research Letters, Elsevier, vol. 62(PB).
    8. Zihao Lin, 2024. "Can digital transformation curtail carbon emissions? Evidence from a quasi-natural experiment," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-12, December.
    9. Huang, Qiping & Li, Yongjia & Lin, Meimei & McBrayer, Garrett A., 2022. "Natural disasters, risk salience, and corporate ESG disclosure," Journal of Corporate Finance, Elsevier, vol. 72(C).
    10. Qiang Li & Tian Li & Hongtao Chen & Erwei Xiang & Wenjuan Ruan, 2019. "Executives' excess compensation, legitimacy, and environmental information disclosure in Chinese heavily polluting companies: The moderating role of media pressure," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 26(1), pages 248-256, January.
    11. Dmitry Livdan & Horacio Sapriza & Lu Zhang, 2009. "Financially Constrained Stock Returns," Journal of Finance, American Finance Association, vol. 64(4), pages 1827-1862, August.
    12. Ye, Yongwei & Zeng, Lin & Tao, Yunqing & Yun, Feng, 2023. "Tax authority monitoring and corporate information disclosure quality in China," International Review of Financial Analysis, Elsevier, vol. 90(C).
    13. Shouyu Yao & Yuying Pan & Lu Wang & Ahmet Sensoy & Feiyang Cheng, 2023. "Building Eco-friendly Corporations: The Role of Minority Shareholders," Journal of Business Ethics, Springer, vol. 182(4), pages 933-966, February.
    14. Lu, Yao & Li, Lu & Zhan, Huanqi & Zhan, Minghua, 2024. "Fintech, information heterogeneity, and the regional distribution effects of corporate financing constraints," Economic Modelling, Elsevier, vol. 137(C).
    15. Zhang, Dongyang, 2022. "Green financial system regulation shock and greenwashing behaviors: Evidence from Chinese firms," Energy Economics, Elsevier, vol. 111(C).
    16. Lin, Ying & Yan, Xiaohan & Yang, Xiuyun, 2023. "Digital finance and enterprise investment efficiency in China," International Review of Financial Analysis, Elsevier, vol. 90(C).
    17. Raj Chetty, 2015. "Behavioral Economics and Public Policy: A Pragmatic Perspective," American Economic Review, American Economic Association, vol. 105(5), pages 1-33, May.
    18. Yangjie Liao & Xiaokun Zhou, 2024. "Real green or fake green? Impact of green credit policy on corporate ESG performance," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-13, December.
    19. Tielong Wu, 2024. "Green finance reform policy increases corporate hypocritical business strategies: Evidence from the greenwashing behavior," Mitigation and Adaptation Strategies for Global Change, Springer, vol. 29(7), pages 1-28, October.
    20. Silvia Ruiz-Blanco & Silvia Romero & Belen Fernandez-Feijoo, 2022. "Green, blue or black, but washing–What company characteristics determine greenwashing?," Environment, Development and Sustainability: A Multidisciplinary Approach to the Theory and Practice of Sustainable Development, Springer, vol. 24(3), pages 4024-4045, March.
    21. Nie, Song & Liu, Junxian & Zeng, Gang & You, Jiyuan, 2023. "Local government debt pressure and corporate ESG performance: Empirical evidence from China," Finance Research Letters, Elsevier, vol. 58(PB).
    22. Zengrui Xiao & Ying Wang & Dongjie Guo, 2022. "Will Greenwashing Result in Brand Avoidance? A Moderated Mediation Model," Sustainability, MDPI, vol. 14(12), pages 1-15, June.
    23. Hanjin Li & Hu Tian & Xinyu Liu & Jiansheng You, 2024. "Transitioning to low-carbon agriculture: the non-linear role of digital inclusive finance in China’s agricultural carbon emissions," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-14, December.
    24. Sun, Xiaoyan & Xie, Xuanli, 2024. "How does digital finance promote entrepreneurship? The roles of traditional financial institutions and BigTech firms," Pacific-Basin Finance Journal, Elsevier, vol. 85(C).
    25. Yin, Lei & Yang, Yuanyuan, 2024. "How does digital finance influence corporate greenwashing behavior?," International Review of Economics & Finance, Elsevier, vol. 93(PB), pages 359-373.
    26. Naeem, Kashif & Li, Matthew C., 2019. "Corporate investment efficiency: The role of financial development in firms with financing constraints and agency issues in OECD non-financial firms," International Review of Financial Analysis, Elsevier, vol. 62(C), pages 53-68.
    27. Hong Xu & Yukun Li & Weifen Lin & Hui Wang, 2024. "ESG and customer stability: a perspective based on external and internal supervision and reputation mechanisms," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-14, December.
    28. Jiayin Bi & Ying Qi, 2024. "RETRACTED ARTICLE: The convergence of digital finance and green investments: opportunities, risks, energy transitions and regulatory considerations," Economic Change and Restructuring, Springer, vol. 57(3), pages 1-31, June.
    29. Peng Wan & Mengjiao Xu & Yu Yang & Xiangyu Chen, 2024. "CSR decoupling and stock price crash risk: Evidence from China," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-12, December.
    30. Zhihua Zhao & Zhenjiang Xing, 2024. "Corporate management, green finance, and sustainability," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-8, December.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. repec:osf:socarx:mnd4f_v1 is not listed on IDEAS
    2. Arnone, Massimo & Costantiello, Alberto & Leogrande, Angelo, 2024. "Banking Credit and Innovation Technology: a Global Perspective," MPRA Paper 122774, University Library of Munich, Germany.
    3. Zhang, Xiangguo & Zhao, Weiyi & Xie, Danxia, 2024. "Environmental regulation, academic top managers and green innovation: Evidence from China," Finance Research Letters, Elsevier, vol. 69(PB).

    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. Zhu, Wenpeng, 2024. "Digital finance, capital misallocation and corporate innovation," International Review of Economics & Finance, Elsevier, vol. 96(PC).
    2. Chen, Hong & Hu, Shangui & Cai, Yuqing, 2024. "Driving effect of fintech on firm green innovation in China's strategic emerging industries: The mediating role of digital transformation," International Review of Economics & Finance, Elsevier, vol. 96(PA).
    3. Jianjun Sun & Nannan Zu & Chao Zhang, 2025. "Big data and firm greenwashing: evidence from China’s national big data comprehensive pilot zone," Palgrave Communications, Palgrave Macmillan, vol. 12(1), pages 1-10, December.
    4. Yang, Yuelin, 2025. "The development of digital finance and the crime rate of theft," Finance Research Letters, Elsevier, vol. 71(C).
    5. Yin, Lei & Yang, Yuanyuan, 2024. "How does digital finance influence corporate greenwashing behavior?," International Review of Economics & Finance, Elsevier, vol. 93(PB), pages 359-373.
    6. Kangqi Jiang & Xiaofeng Chen & Jiayun Li & Mengling Zhou, 2025. "Technology adoption and extreme stock risk: Evidence from digital tax reform in China," Palgrave Communications, Palgrave Macmillan, vol. 12(1), pages 1-20, December.
    7. Zhao, Qiao & Wang, Wangqing, 2024. "Impact of digital financial tools on intermediate goods: Synergies between external funding and internal R&D investment," Finance Research Letters, Elsevier, vol. 67(PB).
    8. Mou, Kefen & Xu, Bing, 2024. "Digital finance, government regulation, and corporate capital market efficiency," Finance Research Letters, Elsevier, vol. 68(C).
    9. Zhang, Cheng & Yu, JiaQi & Bai, Yiyi & Ho, Kung-Cheng, 2024. "The impact of CEO's green experience on digital transformation," Pacific-Basin Finance Journal, Elsevier, vol. 85(C).
    10. Bu, Ya & Du, Xin & Wang, Yuting & Liu, Shuyu & Tang, Min & Li, Hui, 2024. "Digital inclusive finance: A lever for SME financing?," International Review of Financial Analysis, Elsevier, vol. 93(C).
    11. Li, Weiping & Mao, Zhuowei & Ren, Xiaohang & Liang, Jing, 2025. "Retail investor attention: Guardian of corporate ESG integrity or catalyst for greenwashing?," Energy Economics, Elsevier, vol. 144(C).
    12. Huisu Lai & Lei Quan & Fei Wu & Song Tang & Chong Guo & Xiaobing Lai, 2025. "Corporate environmental publicity and green innovation: are words consistent with actions?," Palgrave Communications, Palgrave Macmillan, vol. 12(1), pages 1-14, December.
    13. L. Ende & M.-A. Reinhard & L. Göritz, 2023. "Detecting Greenwashing! The Influence of Product Colour and Product Price on Consumers’ Detection Accuracy of Faked Bio-fashion," Journal of Consumer Policy, Springer, vol. 46(2), pages 155-189, June.
    14. Zhang, Mengzhi & He, Wenjian, 2025. "Encouraging or inhibiting: Can analyst attention reduce corporate greenwashing behavior?," Economic Analysis and Policy, Elsevier, vol. 85(C), pages 943-962.
    15. Hu, Cuiping & Yang, Xianzi, 2024. "A study on the impact of digital governance on disclosure quality of listed companies," Finance Research Letters, Elsevier, vol. 69(PA).
    16. Srisathan, Wutthiya Aekthanate & Naruetharadhol, Phaninee, 2025. "Exploring moral hazard and adverse selection in the context of greenwashing and organic product consumption," Journal of Retailing and Consumer Services, Elsevier, vol. 84(C).
    17. Gregor Dorfleitner & Sebastian Utz, 2024. "Green, green, it’s green they say: a conceptual framework for measuring greenwashing on firm level," Review of Managerial Science, Springer, vol. 18(12), pages 3463-3486, December.
    18. Zhou, Kuo & Qu, Zhi & Liang, Jiayang & Tao, Yunqing & Zhu, Mengting, 2024. "Threat or shield: Environmental administrative penalties and corporate greenwashing," Finance Research Letters, Elsevier, vol. 61(C).
    19. Szerena Szabo & Jane Webster, 2021. "Perceived Greenwashing: The Effects of Green Marketing on Environmental and Product Perceptions," Journal of Business Ethics, Springer, vol. 171(4), pages 719-739, July.
    20. Wang, Linyu & Ji, Yifan & Ni, Zhongxin, 2023. "Spillover of stock price crash risk: Do environmental, social and governance (ESG) matter?," International Review of Financial Analysis, Elsevier, vol. 89(C).

    More about this item

    Statistics

    Access and download statistics

    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:pal:palcom:v:11:y:2024:i:1:d:10.1057_s41599-024-04135-6. 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: Sonal Shukla or Springer Nature Abstracting and Indexing (email available below). General contact details of provider: https://www.nature.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.