Can digital transformation improve corporate green innovation?

Drawing on legitimacy and resource-based theories, this study uses a sample of A-share listed companies in the Shanghai and Shenzhen stock markets from 2010 to 2020. Employing advanced big data text recognition techniques, this study delineates the intensity of corporate digital transformation and explores its impact on green innovation in enterprises. The findings reveal a positive relationship between the degree of digital transformation and the level of corporate green innovation. Mediation analysis indicates that digital transformation facilitates a substantial improvement of green innovation within enterprises by increasing media attention and reducing financing costs. Further analysis suggests that the intensity of regional environmental regulations diminishes digital transformation's positive effects on corporate green innovation. Specifically, the impact of digital transformation on green innovation is more pronounced for enterprises in regions with weaker environmental regulations than in those with stronger regulations. This study contributes to the understanding of the microeconomic implications of corporate digital transformation, enriches the literature on the factors influencing corporate green innovation, provides empirical insights into the economic outcomes of corporate transformation in the digital era, and offers inspiration for the sustainable development of the global economy.