Digitalization and green innovation of enterprises: Empirical evidence from China

With the acceleration of the digital technology construction process, digitalization has given impetus to the transformation and upgrading of China’s economy and micro businesses. China’s social and economic sectors have begun to integrate and develop in-depth with digital technology. Whether the digitalization of enterprises can drive their green innovation is an urgent question to be explored. The aim of our study is to answer this question and investigate whether digitalization has finally affected corporate green innovation. On the basis of theoretical discussion, the data of 3,547 Chinese listed companies from 2014 to 2019 were selected as samples. The fixed effect model was used to empirically test the relationship between digitization and green innovation, and then the intermediary effect model was used to analyze the influence mechanism. Research has found that digitalization is genuinely driving green innovation in business. After the robustness test, the conclusion remains the same. In order to deepen the understanding of the impact of digitalization on the green innovation of enterprises, this study additionally analyzed the impact mechanism. We find that digitization can promote corporate green innovation by easing corporate financing constraints and enhancing corporate awareness of fulfilling social responsibility. Moreover, we also find that the impact of digitalization on firm performance is more obvious in the samples with high level of internal control, state-owned enterprises and senior executives with IT background. The findings of this study enrich the related theories of digitalization and sustainability and provide empirical evidence for the positive externalities of digitalization.