How does enterprise digital transformation promote green innovation? Evidence from listed companies in China

Green innovation is a critical measure for achieving sustainable development. As one of the major development strategies of the Chinese government, digital transformation is an essential choice for promoting green innovation within enterprises. This study analyzes the impact of digital transformation on green innovation, along with its moderating factors, using a sample of 1,108 Chinese publicly listed companies from 2008 to 2021, focusing on both the quantity and quality of innovation. The findings reveal that digital transformation exhibits a 'fine-tuning without expanding' effect on green innovation, significantly enhancing substantive green innovation while having a limited impact on strategic innovation. Additionally, both internal factors and external constraints of enterprises influence the innovation effects of digital transformation. Specifically, the nature of ownership, environmental information disclosure, and industry type exert a positive moderating effect, whereas agency costs have a negative moderating effect. Furthermore, digital transformation indirectly promotes green innovation by integrating resources to increase human capital and R&D capital. This study provides a comprehensive analysis of the utility of digital transformation within enterprises. On a micro level, it offers guidance on how enterprises can further implement digital transformation. On a macro level, it provides theoretical support for the development of China's digital economy.