Driving environmental, social, and governance excellence: The direct and indirect effects of intelligent transformation

Abstract

Integrating intelligent technologies into corporate processes represents a transformative response to sustainable and responsible business practices. Despite its growing significance, the effects and mechanisms through which intelligent transformation impacts corporate environmental, social, and governance (ESG) performance remain insufficiently explored. Drawing on resource orchestration and dynamic capabilities theory, this study develops a theoretical framework to analyze how intelligent transformation empowers ESG improvement. Using a comprehensive dataset of Chinese A-share listed companies from 2009 to 2023, the empirical results confirm that intelligent transformation significantly enhances ESG performance. This improvement is realized through three key channels: enhancing information disclosure quality, fostering green innovation, and mitigating supply chain concentration. Furthermore, the effects are more pronounced among state-owned enterprises, technology- and capital-intensive corporations, corporations located in the eastern area of China, and those operating in highly marketized regions. A value chain analysis further reveals that intelligent transformation in research design, manufacturing, and marketing consistently drives ESG enhancements. These findings enrich the literature on intelligent transformation and provide actionable insights for corporations seeking to optimize their sustainability practices in an intelligence era.