The route towards green transformation: Mechanism of clean production enabled by enterprise digitization

Abstract

Enterprise green transformation (EGT) serves as a microeconomic driver of sustainable economic development. Digital technologies provide critical impetus for EGT by enabling intelligent and precise management of clean production processes. Investigating the impact of enterprise digitalization (ED) on EGT can enhance the effective use of digital technologies for promoting green development. In recent years, China’s level of digital development has significantly advanced, playing a crucial role in pursuing green development. This study explores the direct and indirect effects of ED on EGT from the mechanism of clean production, using data from publicly listed companies in China from 2009 to 2022. The results show that: First, ED significantly promotes EGT, and this causal relationship withstands a battery of robustness checks. Second, from the perspective of clean production mechanisms, ED can facilitate EGT through process optimization and end-of-pipe treatment, but source control mechanism fails to demonstrate a significant positive impact. Third, there is heterogeneity in the green transformation effects of ED, with more pronounced impacts in heavily polluting and state-owned enterprises, and in central and western region firms. Fourth, from a macro perspective, ED significantly enhances regional environmental quality and economic growth, suggesting it is a win-win path for ecological and economic development. These findings provide practical evidence for policymakers to develop ED incentive policies aligned with green development goals.