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Digital transformation for the sustainable development of firms: The role of green capability and green culture

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  • Lei Li
  • Jiabao Lin

Abstract

Leveraging digital transformation to improve environmental performance is critical for sustainability. However, the underlying mechanism in the relationship between digital transformation and environmental performance remains unclear. Through the lens of IT‐enabled organizational capabilities, this study develops a moderated mediation model to examine the mechanisms and boundary conditions through which digital transformation affects environmental performance. Using a sample of Chinese agriculture firms, our findings reveal that digital transformation positively environmental performance through green capability, and this indirect effect is stronger when green culture is higher. Moreover, green culture moderates the relationship between digital transformation and green capability. Our theoretical explanation and empirical evidence contribute significantly to the literature by providing insights on how to leverage digital transformation initiatives to improve environmental performance.

Suggested Citation

  • Lei Li & Jiabao Lin, 2024. "Digital transformation for the sustainable development of firms: The role of green capability and green culture," Sustainable Development, John Wiley & Sons, Ltd., vol. 32(3), pages 1861-1875, June.
    • Handle: RePEc:wly:sustdv:v:32:y:2024:i:3:p:1861-1875
    DOI: 10.1002/sd.2756
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    Cited by:

    1. Jiabao Lin & Minyi Mao, 2024. "How does digital transformation affect sustainable innovation performance? The pivotal roles of digital technology‐business alignment and environmental uncertainty," Sustainable Development, John Wiley & Sons, Ltd., vol. 32(4), pages 3163-3181, August.
    2. Hai Huang & Shengbin Hao, 2025. "Enterprise digital transformation and sustainable development performance: The asymmetric roles of top management team faultlines," Sustainable Development, John Wiley & Sons, Ltd., vol. 33(2), pages 1670-1685, April.
    3. Le Sun & Tze San Ong & Boon Heng Teh & Assunta Di Vaio, 2024. "Sustainable performance measurement through digital transformation within the sustainable development framework: The mediating effect of supply chain concentration," Sustainable Development, John Wiley & Sons, Ltd., vol. 32(6), pages 5895-5912, December.
    4. Shu Wang & Yueling Yang & Heyao Yin & Jianya Zhao & Ting Wang & Xiaomei Yang & Jing Ren & Changbin Yin, 2025. "Towards Digital Transformation of Agriculture for Sustainable Development in China: Experience and Lessons Learned," Sustainability, MDPI, vol. 17(8), pages 1-29, April.

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