Digital Transformation, Green Technology Innovation and Enterprise Financial Performance: Empirical Evidence from the Textual Analysis of the Annual Reports of Listed Renewable Energy Enterprises in China

Digital transformation in renewable energy enterprises offers critical opportunities for China’s green orientation and sustainable growth. Based on a statistical data of Chinese A-share listed renewable energy companies, we explore the effects of digital transformation on a company’s financial performance and the mediating role of green technology innovation. The findings indicate that there is a driving effect of digital transformation on renewable energy companies’ financial performance. Our results remain valid after a series of robustness tests. Furthermore, a heterogeneous analysis indicates that enhancing digital transformation only positively affects the financial performance of state-owned firms and firms in the eastern area, and the driving effect of digital transformation is greater for large firms. In addition, green technology innovation plays a complete mediating role in digital transformation’s impact on renewable energy enterprises’ financial performance. Specifically, when a renewable energy company has digital transformation, it has better green technology innovation leading to better financial performance. Our results provide vital implications for promoting the effectiveness of digital transformation in the development of renewable energy enterprises.