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Article

What Drives Firms to Go Green in China? The Role of Digitalization

by
Xiaoyan Pan
1 and
Shufeng Xiao
2,*
1
School of Economics and Management, Taizhou University, Taizhou 225300, China
2
Division of Business Administration, Sookmyung Women’s University, 100, Cheongpa-ro 47-gil, Yongsan-gu, Seoul 04310, Republic of Korea
*
Author to whom correspondence should be addressed.
Sustainability 2025, 17(1), 234; https://doi.org/10.3390/su17010234
Submission received: 24 November 2024 / Revised: 19 December 2024 / Accepted: 27 December 2024 / Published: 31 December 2024
(This article belongs to the Special Issue Digital Transformation and Innovation for a Sustainable Future)
Browse Figure
Versions Notes

Abstract

:
With the deep integration and development of both the digital economy and the ecological economy, governments, media, researchers and others have begun paying great attention to green digital issues. Yet whether and how digital resources shape corporate social responsibility (CSR) remains unclear. This paper examines the relationship between digital resources, CSR, and environmental performance during a period of rapid technological development, with a focus on Chinese manufacturing enterprises. We draw on structural equation modeling (SEM) to verify how digitalization contributes to more environmentally friendly and sustainable economic development. Our dataset comprises survey data from 174 Chinese manufacturing companies, providing a theoretical basis and empirical support for the deep integration of digitalization with green and low-carbon transformation. The results demonstrate that digital resources significantly promote CSR, which in turn facilitates the improvement of environmental performance. We thus find that CSR plays a mediating role in the digital resources–environmental performance relationship. Consequently, companies can consider greening their innovations through CSR practices as part of the digital transformation environment. Finally, digital resources and CSR contribute to greening innovation in different ways. This study highlights the critical role of robust CSR in driving green performance during digital transformation. It addresses a significant research gap by exploring the synergistic relationship between digitalization and green innovation, emphasizing the strategic importance of integrating CSR to achieve mutually beneficial outcomes for both society and businesses. Additionally, the study identifies deficiencies in existing research regarding the interplay between digital transformation and CSR and investigates how enterprises can directly enhance environmental performance by leveraging digital resources within the context of the digital economy.

1. Introduction

Today, carbon neutrality and sustainable development are important issues of global concern. This global consensus suggests that people are actively seeking ways to address the challenge. According to the Chinese government’s successive national policies, implementing the “dual-carbon” strategy requires the deep integration of digital transformation with green and low-carbon transformation, i.e., digitalization as an important tool for green and low-carbon transformation, and green as the theme underlying the digital transformation of enterprises. The government thus encourages enterprises to use digital technology to promote enterprise green low-carbon transformation, and in this process to have a “multiplier” effect of digitalization, networking and intelligence. Clearly, the collision between an emerging sustainable carbon-reducing economy and an accelerating digital economy provides a new orientation for the creation of economic development models for the new era. These models will not only stipulate a higher level of requirements for enterprises to ensure high-quality and sustainable development but also pose a new problem to researchers.
Firstly, in the field of sustainability, companies around the world have recently become increasingly interested in their corporate social responsibility (CSR) practices [1]. CSR is an important component of corporate strategy and is destined to become a dominant business behavior for long-term sustainability and high-quality development [2,3]. Businesses can establish and maintain closer relationships with stakeholders through CSR, addressing mutual legitimate interests and facilitating the discovery of new opportunities [4]. It is generally held that CSR should be integrated into the corporate management model as it helps to justify strategic choices and allows companies to generate unique and strategic resources, which in turn lead to enhanced corporate performance and competitiveness [5,6].
Secondly, against the backdrop of the Chinese government’s clear commitment to strengthening the building of a “digital China”, China’s digital economy has seen impressive growth. In particular, the rate of enterprise digital transformation in 2021 is expected to grow rapidly by 45% compared to 2020. Given the popularity and urgency of corporate transformation, there have been calls to study the causal relationships between digital resources, CSR, and environmental performance in the process of corporate transformation, so as to examine the impact of digitization on corporate green behaviors. However, while many studies have elucidated the urgency and importance of digital transformation [7,8,9], fewer studies have explored how corporates utilize their internal digital resources and the extent to which different forms of digital resources contribute to or constrain the development of CSR, and thus environmental performance. More importantly, the results of previous research on digital transformation’s effect on CSR are controversial [10], with some scholars arguing that digital transformation is conducive to CSR and others pointing out that digital transformation may introduce the risk of disruptive failures, which is detrimental to CSR.
Thirdly, implementing socially responsible behavior is an important goal in the manufacturing industry. In recent years, investments in the field of environmental management and sustainability have become increasingly important due to global environmental dynamics and stakeholder pressures [11]. However, beyond legal and social pressures, the benefits of investing in environmental activities are not clear to some companies in CSR-sensitive industries [12]. This paper thus examines the relationships between the emerging resources generated in the digital age, CSR, and green performance, taking manufacturing companies as the subject of the study. We choose the manufacturing sector as it is often criticized as having the most prominent environmental pollution problems among all industries. Our study is articulated around two main research questions: one, are digital resources relevant to CSR, and two, can CSR, in the digital age, be reflected in higher levels of environmental performance?
To address these questions, we draw on structural equation modeling (SEM) to verify how digitalization contributes to more environmentally friendly and sustainable economic development. Our dataset comprises survey data from 174 Chinese manufacturing companies, providing a theoretical basis and empirical support for the deep integration of digitalization with green and low-carbon transformation.
This study is roughly structured into three main parts. First, the relationships between digital resources, CSR and environmental performance are theoretically modeled. Next, statistical tests are conducted through SEM. Finally, the paper presents the findings as well as the theoretical and managerial implications and draws conclusions.

2. Theoretical Basis and Hypotheses Development

2.1. The Resource-Based View and Digital Resources

The resource-based view (RBV), which suggests that competitive advantage and superior performance are derived from an organization’s unique and not easily imitated resources and capabilities, explains performance differences between firms and is one of the most widely used theoretical foundations [13,14]. Emerging resources are equally indispensable for firms to achieve quality performance and gain competitiveness during a period of rapid technological development [15,16]. Among these resources, the organizational culture perspective understands strategic orientation as the management philosophy and corporate culture that can lead the growth of an enterprise, which embodies the guiding direction of enterprise development and quality performance [17]. The close relationship between strategic orientation and enterprise performance is the basis for guiding enterprises to achieve good performance, and it is an important strategic resource for promoting the sustainable development of enterprises. For instance, technology-oriented firms take technology development and innovation as their core strategic direction and rely on their use of technology to maintain competitiveness and sustained growth [18]. Strong investment in technology thus not only enhances these firms’ technological capabilities but also promotes their pursuit of higher performance [19]. With firms facing digital change, this paper builds on the findings of Ref. [18] in defining digital transformation orientation as a technological orientation in the digital environment. It also introduces the new term digital capability [20], which denotes a firm’s digital capabilities through the state of its information technology infrastructure, its technical support, and its ability to create [21].
Based on the RBV, this study considers digital resources to encompass firms’ digital transformation orientation and digital capabilities. Ref. [22] synthesized various perspectives on digital business strategy, highlighting the integration of technological orientation and digital capabilities within strategic positioning as critical for achieving a competitive advantage in the digital economy. To provide a comprehensive understanding of how these studies enhance our knowledge of firm performance and competitiveness, we have compiled Table 1, which summarizes their key contributions and the technologies or fields they address.

2.2. Digital Resources and CSR

Affected by rapidly developing digital technology and numerous uncertainties such as environmental and health crises, the core competitive advantages of enterprises must be inseparable from their core competitive capabilities. Ref. [23] argues that enterprises are committed to embracing new technologies and responding to the fast-changing business environment through digital resources. Ref. [24] contend that enterprises seize emerging digital technologies and the industry’s digitalization trends to become innovation leaders and create multifaceted value for internal employees, customers, partners, and social and environmental stakeholders. Digital transformation brings many benefits to companies and promotes sustainable development [9], which may be an important factor for stakeholders, compelling companies to undergo transformation. Specifically, digitally transformed firms can provide internal employees with new skills, better career development opportunities, and greater productivity [25]. Meanwhile, employees of firms with internal CSR programs are known to have a sense of purpose and fulfillment that is aligned with the firm, are more willing to experiment with new technologies, and are more receptive to digital transformation and innovation [26,27], optimizing production, operations, and energy use efficiency. In addition, firms can more accurately measure their social and environmental benefits through their use of emerging technological resources to address social and environmental challenges. With regard to branding and competitiveness, companies can, for example, introduce CSR innovations into their processes, adopt “green” production methods, maintain competitiveness by lowering the final cost of their products (e.g., by saving energy or lowering waste disposal costs), or develop differentiated products and services that are environmentally friendly through CSR.
More importantly, digital transformation is not just the implementation of digital tools or platforms as it also represents a cultural change. It not only requires companies to use digital technologies in their operations but also involves a transformational awareness of people throughout the business world. Efficient internal communication in a company can facilitate the implementation of a social responsibility strategy, which has a positive impact on the promotion of CSR [8]. In this regard, companies that tend to lead technological change are more active in seeking and improving relationships with key stakeholders than those that tend to follow technology, as these activities help to gather more valuable information [28].
In summary, CSR provides a new way to acquire value in the digital era, referring to the potential value-enabling and co-creation effects of corporate digital transformation on the collaborative networks of employees, customers, society and the environment, which we may call digital reciprocity. Based on these arguments, this study proposes two hypotheses:
Hypothesis 1a:
Digital capabilities have a significant positive effect on CSR.
Hypothesis 1b:
Digital orientation has a significant positive effect on CSR.

2.3. CSR and Environmental Performance

CSR is widely recognized as a motivator for organizations to gain a competitive advantage and achieve quality performance because it leads to the more effective implementation of human resources, better access to capital and markets, and better brand reputation and customer loyalty, while also promoting risk management practices and decision-making capabilities [29]. Strategically, CSR activities promote green innovations that deliver social benefits [30]. For example, in environmentally sensitive industries, innovations realized by CSR activities are reflected in more effective pollution prevention, waste recycling, and energy utilization, and can also be applied to organic products, green design, environmental management, etc. [31]. For example, a survey of 252 Brazilian firms showed that enterprises committed to environmental protection strategies and supporting green consumers were more concerned with the differentiated innovation of green products, demonstrating the key role of CSR in the quality of products and services offered [32]. Ref. [33] findings are in line with the conclusion that the better the fulfillment of responsibility, the higher the level of the environmental performance of a company, demonstrating the significant positive correlation between the two.
Empirical studies have also found that when firms perform well in terms of social responsibility, they are more likely to attract the interest of various types of investors and stakeholders, including governments, private investors, and environmental and social responsibility groups. This increased base of support usually means more financing opportunities and resource availability; with these additional resources, firms can invest in projects and practices that improve environmental performance, such as reducing carbon emissions, improving resource efficiency, adopting greener technologies, and so on. With improved environmental performance, companies are not only able to meet regulatory and market demands, but they can also reduce environmental risks and improve efficiency, which further enhances their attractiveness and attracts more investment and stakeholders. The study covering five different industries by Ref. [34] found that the relationship between CSR fulfillment and environmental performance can be seen as a positive cycle. CSR fulfillment attracts the attention of investors and stakeholders, providing firms with capital and resources to improve their environmental performance; in turn, improved environmental performance enhances CSR performance. This cyclical process contributes to the long-term sustainable social, environmental and economic achievements of an enterprise.
Thus, overall, companies with a high level of commitment to CSR will be able to build stronger relationships and have a more positive impact on those who have a stake in their business activities and decisions. Both in terms of processes and products, this will enable companies to benefit from more channel opportunities. Based on the above discussion, we formulate the following hypothesis:
Hypothesis 2:
CSR is positively related to environmental performance.

3. Research Methodology

3.1. Sample and Data Collection

The study chooses to focus on China’s manufacturing sector for three main reasons: First, the main industry of China’s economy is manufacturing, which plays a key role in realizing the country’s development. Data from the National Bureau of Statistics show that China’s manufacturing value added will grow by about 3% in 2022, and the share of manufacturing value added in GDP will reach 27.69%, at a scale of USD 4.35 trillion. Furthermore, at present, the development of new technologies is advancing by leaps and bounds, and China’s manufacturing industry is actively promoting the digital transformation of enterprises. In addition, the manufacturing industry has a profound impact on the environment due to poor labor conditions, environmental pollution, and resource depletion, among others. To ensure the diversity and generalizability of our findings, our sample population covers manufacturing companies from a wide range of industries, including machinery and steel manufacturing, chemical and petrochemical products, medical devices and biopharmaceuticals, electronics and electrical equipment, and more.
The measurement items included in the questionnaire were derived from previous well-established studies and translated into Chinese for use in the questionnaire by two professional bilingual translators to ensure effective responses, analysis, and the drawing of reliable conclusions. The survey data were collected with the help of relevant government departments and industry associations to encourage middle and senior management to participate in the study, and a local professional research company was employed to conduct the survey procedures. A total of 190 completed questionnaires were received, and excluding invalid responses with obvious logical contradictions, the final number of valid questionnaires was 174. The detailed sample characteristics are shown in Table 2, which reveals that the enterprise sample selection has a certain degree of diversity as it includes a number of industry sectors, covering different enterprise sizes, product natures, and other attributes.
Common variance bias was tested using the single-factor procedure [35]. First, a confirmatory factor analysis model M1 was constructed with the following main fit indices: χ2/df = 1.972, IFI = 0.935, TLI = 0.925, RMSEA = 0.070. Then, all constructs were organized to form a one-factor structural model M2 with the following main fit indices: χ2/df = 6.779, IFI = 0.596, TLI = 0.556, RMSEA = 0.170. The results show that the M2 model is a very poor fit, indicating that the one-factor structure does not exist. Comparison of the main fit indices for Model M1 and Model M2 yielded ∆χ2/df = 4.807, ∆IFI = 0.339, ∆TLI = 0.463, ∆RMSEA = 0.100. The large variations in each of the fit indices indicate that the measurements do not have significant common method bias.

3.2. Variables and Measurement

The Likert 7-point scale adopted in this study, a widely utilized tool in social science research, ranges from 1 (“strongly disagree”) to 7 (“strongly agree”) and provides a more accurate reflection of respondents’ views and attitudes compared to the 5-point scale. This scale offers more nuanced response options, enhances data variability, and reduces the ambiguity often associated with middle options, thereby improving the discriminability and validity of the research. Moreover, the 7-point scale more effectively captures respondents’ genuine sentiments and mitigates extreme response bias, ultimately increasing the precision and reliability of the study’s findings.
Digital capabilities and digital transformation orientation. A firm’s digital capability is measured through three dimensions: the firm’s hardware and software information base, (digital) IT support capabilities, and innovation capabilities [20,36]. The measurement of a firm’s attitude towards digital transformation is based on previous literature [37,38,39] and uses four items: the firm is committed to digital transformation, covering all areas that can be digitized; the firm collects a large amount of data from different sources; the firm aims to leverage emerging information technologies to create closer connections between different business processes to fully exploit the technological dividends; and the firm aims to change the way it interacts with its customers through digitization to provide more choice and convenience and increase customer value.
CSR. In view of China’s institutional background, economic model, cultural differences, and the late start of CSR research in this context, this paper uses a scale developed by domestic scholars [40]. Following actual validation by Chinese scholars, the scale has proven to be both valid and very consistent in the Chinese context. The scale adopts the well-established 42-item social responsibility scale [41], which covers five core dimensions, namely employee rights and interests, product quality and safety, business integrity and fair competition, social charity, and environmental sustainability responsibility.
Environmental performance. Environmental performance incorporates three dimensions: production process environmental governance, end-of-pipe environmental governance, and environmental management system. The performance measurement refers to the research results of Cooper and Kleinschmidt [42].
Control variables. Consistent with previous literature on strategic orientation [43,44], this study includes firm size and age in the analysis as controls to exclude other potential effects. In this case, firm size is assessed based on the number of employees employed and firm age is measured based on the year the firm was established. Specifically, the number of employees serves as a standardized metric that enables comparison across industries and regions, offering a unified benchmark for assessing company size. Additionally, compared to financial indicators, data on the number of employees are generally more accessible. Similarly, the year of a company’s establishment is an officially recorded detail, commonly documented in corporate registration and business records, making it a reliable and easily verifiable measure.

4. Empirical Testing and Results

To empirically test the hypotheses, this study explored and validated the conceptual model through SEM. SEM provides insights into the relationships between the variables in a study and has wide applications in mediating variable research as it enables the existence and magnitude of the mediating effect to be quantified and validated [45]. To ensure the quality of the measurement instrument and improve the credibility of the study results, we first conducted reliability and validity tests and tested the hypotheses using SEM.

4.1. Reliability and Validity Testing

The study was statistically analyzed using SPSS 26.0 and Amos 24.0. The reliability of the model was assessed with reference to Cronbach’s alpha values and composite reliability (CR). The results, as presented in Table 3, show that the Cronbach’s alpha coefficients for all constructs range from 0.910 to 0.985, and the reliability values range from 0.923 to 0.980; these are all acceptable values, indicating the good internal consistency of the measurement model [46]. The standardized factor loadings of all the constructs show strong significance, with values exceeding the threshold of 0.6, which further confirms the robustness and reliability of the measurement model. In addition, the measurement scales in this paper are based on well-established scales, ensuring good construct validity. The average variance extracted (AVE) values for each construct exceed the threshold of 0.50 and range from 0.750 to 0.860, indicating the good reliability and convergent validity of the model [47].
To investigate the discriminant validity between the constructs, this paper measured the correlations between the different constructs by comparing them. The results show that the square root of the AVE for each construct is greater than the correlation between that construct and the other constructs, indicating that the measure has sufficient discriminant validity [47]. The specific results are shown in Table 4. In addition, the loading values for each of the constructs are higher than their cross-loading values with the other constructs, again demonstrating the adequacy of the discriminant validity.

4.2. Hypothesis Testing

The goodness-of-fit indicators of the structural equation model in this study indicate that the model has credibility and is suitable for interpreting the observed data, as shown by the values in Figure 1 (χ2/df = 2.155, IFI = 0.932, TLI = 0.925, RMSEA = 0.078). The research results reveal that both digital resources (digital capabilities and digital transformation orientation) have a significant positive impact on CSR. The path coefficient of digital capabilities to CSR is 0.282 (p < 0.001); therefore, Hypothesis 1a is supported. The path coefficient of digital transformation orientation to CSR is 0.560 (p < 0.001), supporting Hypothesis 1b. Meanwhile, there is a significant positive association between CSR and environmental performance (β = 0.645, p < 0.001), meaning that Hypothesis 2 is supported. This implies that firms that are more active in social responsibility usually perform better in terms of environmental performance.
However, we observe that digital capability is significantly and positively associated with environmental performance in the relationship between the two antecedent variables of CSR and environmental performance (β = 0.157, p < 0.05), and the statistical relationship between digital transformation orientation and environmental performance fails to be significantly supported. This finding suggests that stronger firms’ digital capabilities contribute to the realization of good environmental performance; however, transformation orientation alone does not seem to be able to practically influence firms’ environmental performance. We summarize the results in Figure 1. We have empirically demonstrated a positive correlation between digital capabilities and environmental performance, a result consistent with findings in the current academic literature [48,49,50]. Ref. [51] highlighted the active role of artificial intelligence technology in reducing carbon emissions within the manufacturing sector. Similarly, RFID technology enables the efficient collection of real-time data on production, quality monitoring, and environmental aspects across various applications [52]. Blockchain technology enhances transparency in recycling and reuse processes, ensuring the authenticity and integrity of environmental governance [53]. Ref. [54] further argued that digital technology fosters green technological innovation to mitigate environmental impacts, reduce energy consumption through intelligent and efficient management practices, and strengthen a company’s capacity to disclose environmental information.
Therefore, we further validated the mediating role of CSR, as shown in Table 5. The findings suggest not only that digital capability directly affects environmental performance, but also that CSR partially mediates the relationship between digital capability and environmental performance. In contrast, the direct relationship between digital transformation orientation and environmental performance fails to receive statistically significant support, but CSR has a fully mediating effect between the two. In other words, digital transformation orientation may have an indirect effect on environmental performance by influencing the degree of CSR fulfillment, which highlights the key role played by CSR in mediating the relationship between digital transformation and environmental performance.

5. Conclusions and Implications

5.1. Discussion and Conclusions

First, using the RBV as a theoretical foundation, this paper examines the role of digital resources in promoting the development of CSR and how they transform corporate resources into environmental protection advantages. The results of our analysis show that when manufacturing companies actively respond to digital transformation policies and continuously build and improve their digital capabilities, they tend to develop CSR to achieve better environmental performance. In other words, positive digital capabilities and transformation orientation can help firms better understand stakeholder needs and innovate in employee management, product development, social image, and other aspects, thereby achieving better business performance.
Second, the paper also shows how CSR in the era of digitalization, globalization and sustainability can play a key role in companies’ use of digital resources to achieve environmental protection. To realize the synergistic development of new resources and environmental protection in the context of the digital economy, firms should start with stakeholders and actively seek new sources of innovation from a CSR perspective [55]. The findings of this paper are particularly salient in this regard as they confirm the mediating role of CSR. CSR practices play a crucial role in enhancing environmental performance, demonstrating that companies pursuing social responsibility simultaneously strengthen their positive environmental impact. In the context of digital transformation, CSR can be viewed as an integral component of corporate green innovation.
Moreover, good relationships with stakeholders have been shown to be crucial for firms pursuing innovation [11]. Meanwhile, companies that try to become technological leaders without a solid commitment to CSR will never reach such a position because they will be unable to retain highly qualified employees or establish and maintain good relationships with other stakeholders such as suppliers, customers, and community organizations [56]. This study reinforces the aforementioned findings, demonstrating that CSR is not merely a reflection of ethical behavior but also a pivotal business strategy. In the context of digitalization, globalization, and sustainability, integrating CSR into business strategies enables companies to effectively enhance both environmental and social performance during the digital transformation process. Such integration not only bolsters the company’s ethical reputation but also fosters comprehensive development across economic, environmental, and social dimensions, providing a sustainable competitive advantage in the market.
In summary, against the backdrop of a rapidly developing digital economy, there is a positive relationship between digital transformation orientation and digital capabilities and CSR and environmental performance. This highlights the importance of CSR in the era of digital development and the need for companies to enhance stakeholder engagement to become more innovative amidst an environment characterized by new technological developments.

5.2. Theoretical Contributions

This paper proposed and tested a conceptual model of the relationship between digital resources and CSR and environmental performance; thus, its theoretical value lies in its discovery of the important role that good CSR plays in empowering green performance creation through digital transformation. In turn, digital resources should be considered as part of a CSR strategy for achieving win-win situations for both social and business goals. In other words, digitalization extends beyond technological advancement and is intrinsically linked to CSR practices, which play a crucial role in improving environmental performance. Although scholars have demonstrated the role of digital transformation and CSR in influencing performance separately, there is almost no research on the relationship between corporate digital resources and environmental performance in the synergistic development of digitalization and green innovation. Therefore, in the context of the digital era, this study advances the RBV by enriching its scope and connotations, offering a novel theoretical framework for understanding the impact of digitalization on corporate environmental behavior.
The findings confirm the mediating role of CSR between digital resources and environmental performance, presenting a fresh perspective on how companies can enhance environmental outcomes through CSR initiatives. The study underscores the pivotal role of digital resources in driving green performance, highlighting how digital technology fosters green innovation by improving employee skills, productivity, and career opportunities. Furthermore, it emphasizes the importance of cultivating strong stakeholder relationships as a critical factor for companies pursuing innovation, particularly during the digital transformation process. This research not only bridges the gap in understanding the synergistic relationship between digitalization and green innovation but also underscores the strategic importance of integrating CSR into business strategies to achieve mutually beneficial outcomes for both society and businesses. By addressing these critical areas, the study provides valuable insights and sets the stage for future research in this domain.

5.3. Practical Implications

These findings also have important practical implications in that firms that actively engage in transformation strive for excellence in their CSR activities because they are consequently better able to learn about opportunities from their stakeholder relationships through digital resources, making them more innovative. Therefore, business managers should realize the importance of digital resources in promoting innovation in CSR and performance.
Another important managerial implication is that CSR should be considered as an important business strategy in the management of transformation and innovation. Especially in socially and environmentally sensitive industries, organizations should be oriented towards CSR development, anticipate or flexibly respond to stakeholder needs and market changes, and proactively consider environmental and social aspects and requirements in their business strategies. In the long run, only responsible and innovative companies that are able to integrate CSR into their strategies will survive and thrive in these industries.

6. Limitations and Future Research

This study has the following three limitations. First, it used primary data from a questionnaire survey, which means that the long-term impact relationship between digital resources, CSR and environmental performance is difficult to observe. Future research may verify the findings by using both objective and subjective data. In addition, the study sample was drawn from Chinese manufacturing firms, which may introduce cultural constraints and institutional issues; hence, future research could focus on a broader context (e.g., other industries or countries) in an attempt to validate and generalize the results obtained in this paper. Finally, future research could also consider establishing other variables, such as competitive intensity, environmental turbulence or new product performance, which may have an important impact on the analysis of the problem.

Author Contributions

Conceptualization, X.P. and S.X.; methodology, X.P. and S.X.; validation, S.X.; formal analysis, X.P.; investigation, X.P.; data curation, X.P.; writing—review and editing, X.P. and S.X. All authors have read and agreed to the published version of the manuscript.

Funding

This research was supported by the General Project of Philosophy and Social Science Research in Jiangsu Universities in 2022, China (No. 2022SJYB2321).

Institutional Review Board Statement

The study was approved by Taizhou University Institutional Review Board approval number 1044396-202308-HR-145-01.

Informed Consent Statement

Informed consent was obtained from all subjects involved in the study.

Data Availability Statement

Data are available on request from the authors.

Acknowledgments

We appreciate the financial support provided by the General Project of Philosophy and Social Science Research in Jiangsu Universities in 2022, China (No. 2022SJYB2321). We would also like to thank the anonymous reviewers for their valuable comments and suggestions to further improve this article.

Conflicts of Interest

The authors declare no conflicts of interest.

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Sustainability 17 00234 g001
Figure 1. Results of structural equation modeling.
Figure 1. Results of structural equation modeling.
Sustainability 17 00234 g001
Table 1. Literature contributions and technology/field application.
Table 1. Literature contributions and technology/field application.
AuthorsYearMain ContributionsApplication Area/Technology
Barney1991Proposed the Resource-Based View (RBV), explaining differences in firm performance.Firm Resources and Capabilities
Gatignon and Xuereb1997Defined the strategic direction of technology-oriented firms, emphasizing the importance of technological innovation.Technology Development and Innovation
Zhou et al.2005Explored the relationship between strategic orientation and corporate culture, emphasizing its guiding role in enterprise development.Organizational Culture and Strategic Orientation
Liu et al.2011Analyzed the impact of emerging resources on firm performance, emphasizing the importance of technological development.Rapid Technological Development
Ruiz-Ortega et al.2013Analyzed the impact of technology investment on firm performance, emphasizing the enhancement of technological capabilities.Technology Investment and Performance
Levallet and Chan2018Described the composition of a firm’s digital capabilities, emphasizing technical support and creative abilities.Information Technology Infrastructure and Technical Support
Khin and Ho2019Introduced the concept of digital capability, emphasizing the importance of information technology infrastructure.Digital Transformation and Digital Capabilities
Xiao et al.2021Synthesized perspectives on digital business strategy, emphasizing the integration of technological orientation and digital capabilities.Digital Business Strategy
Table 2. Sample characteristics.
Table 2. Sample characteristics.
N%
Firm age
 Below 105732.8
 11–309756.3
 Over 301910.9
Firm type
 State-owned enterprises116.3
 Private enterprises10862.1
 Foreign-owned enterprises3821.8
 Joint ventures52.9
 Others126.9
Firm size
 Below 30011767.2
 301–20004023.0
 Over 2000179.8
Average annual turnover (millions of CNY)
 Below 3126.9
 3.1–204324.7
 20.1–4007945.4
 Over 4004023.0
Product category
 Consumer durables148.0
 Consumer non-durables74.0
 Complete industrial products3218.4
 Raw materials/component industrial goods5028.7
 Others7140.8
Note: N = 174.
Table 3. Results of construct reliability and validity testing.
Table 3. Results of construct reliability and validity testing.
Construct and IndicatorsMeanSDSFL
Digital Transformation (AVE = 0.750, alpha = 0.922, CR = 0.923)
Businesses are committed to digital transformation, covering everything that can be digitized5.1381.2740.857
Companies collect a lot of data from different sources5.1151.2670.908
The corporate goal is to utilize digital resources to create closer connections between different business processes5.4211.1390.834
The corporate goal is to enhance efficient customer interfaces through digitization5.2181.2390.863
Digital Capabilities (AVE = 0.860, alpha = 0.980, CR = 0.980)
Communication technology and network infrastructure for enterprise support of connectivity to various digital platforms, etc.5.0861.2530.861
Enterprise support for digital platforms, extended applications, etc.5.2071.2640.866
Enterprises can plan business activities between business sectors supported by information (digital) technology5.0921.2690.939
Enterprises can develop programs for the application of information systems in business cooperation5.1091.2610.936
Enterprises are able to utilize information (digital) technology resources to establish effective cooperation mechanisms5.1321.2350.967
Companies can develop new markets with partners through information (digital) technology5.0291.2370.952
Enterprises are better able to take advantage of Internet-based business opportunities5.1671.2030.939
Enterprises can enhance information sharing and respond faster to the market through information (digital) technologies5.1951.2050.954
CSR (AVE = 0.781, alpha = 0.910, CR = 0.947)
Employee rights and benefits5.6111.0790.900
Product quality and safety6.0810.9290.890
Business integrity and fair competition6.0440.9750.893
Social security5.5731.1280.873
Environmental sustainability5.8311.0830.864
Environmental Performance (AVE = 0.831, alpha = 0.985, CR = 0.951)
Wastewater is reduced in business operations5.7410.9720.912
Reduced emissions from business operations5.7290.9860.907
Solid pollution from business operations has been reduced5.7290.9690.927
Pollutants have been reduced during the production phase of the enterprise5.7130.9550.899
Note: SD = standard deviation, SFL = standardized factor loading, AVE = average variance extracted, CR = Composite reliability.
Table 4. Results of discriminant validity testing and correlations among variables of interest.
Table 4. Results of discriminant validity testing and correlations among variables of interest.
Variables1234
1. Digital transformation0.866
2. Digital capabilities0.547 ***0.927
3. CSR0.714 ***0.613 ***0.884
4. Environmental performance0.605 ***0.568 ***0.779 ***0.912
Note: N = 174. The diagonal values denote the square root of the AVE of each construct. *** p < 0.001.
Table 5. Results of mediating effect testing.
Table 5. Results of mediating effect testing.
VariablesEstimateCoefficientsBias-Corrected
95% CI		Percentile
95% CI
SEZLowerUpperLowerUpper
Total Effects
Digital transformation → Environmental performance0.358 0.0834.3130.2140.5380.1900.519
Digital capabilities → Environmental performance0.293 0.0863.4070.1290.4560.1430.476
Indirect Effects
Digital transformation → Environmental performance0.309 0.0694.4780.2010.4850.1750.446
Digital capabilities → Environmental performance0.157 0.0552.8550.0740.3000.0630.280
Direct Effects
Digital transformation → Environmental performance0.049 0.0840.583−0.1100.222−0.1020.232
Digital capabilities → Environmental performance0.136 0.0691.9710.0060.2780.0170.299
Note: 1000 bootstrap samples.
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Pan, X.; Xiao, S. What Drives Firms to Go Green in China? The Role of Digitalization. Sustainability 2025, 17, 234. https://doi.org/10.3390/su17010234

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Pan X, Xiao S. What Drives Firms to Go Green in China? The Role of Digitalization. Sustainability. 2025; 17(1):234. https://doi.org/10.3390/su17010234

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Pan, Xiaoyan, and Shufeng Xiao. 2025. "What Drives Firms to Go Green in China? The Role of Digitalization" Sustainability 17, no. 1: 234. https://doi.org/10.3390/su17010234

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Pan, X., & Xiao, S. (2025). What Drives Firms to Go Green in China? The Role of Digitalization. Sustainability, 17(1), 234. https://doi.org/10.3390/su17010234

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