Digital transformation and metal enterprise value: Evidence from China

Digital transformation (DT) has become a new driving force for enterprise development, and whether it can promote the value enhancement of high-polluting enterprises such as metal enterprises is still unknown. Taking Chinese listed metal enterprises from 2001 to 2020 as an example, this study collects the keywords "DT" in the annual reports of metal enterprises with the help of crawler technology, and builds an econometric model to empirically test the impact of DT on the value of metal enterprises and its mechanism. According to the study, DT dramatically raises the value of metal firms. This enhancement effect is more pronounced for metal enterprises located in the western region and those with leverage ratios that fall within the acceptable range. These findings still hold after mitigating the endogeneity problem and undergoing robustness tests. Mechanism tests show that DT can enhance the internal incentives for metal enterprises through increased R&D investment and strengthen the external pressure faced by metal enterprises through increased media attention to promote the value of metal enterprises. Moreover, DT can alleviate the financial risk of metal companies and improve resource allocation efficiency, thus promoting the value of metal companies. This study provides valuable references for metal firms to utilize digital technology better to support high-quality development.