LAUSR

Corporate performance in ESG has received increased attention; however, the discussion on how digital development will affect corporate practice of ESG needs to be deepened. This paper discusses the impact of digital transformation on corporate ESG performance using multiple linear regressions with STATA 17.0 for 2707 companies listed in China A-shares in the period 2010–2021. Based on principal–agent theory, resource-based theory and signaling theory, the study finds that digital transformation can improve corporate ESG performance. From an external perspective, the contribution of digital transformation to ESG performance diminishes when environmental uncertainty increases; from an internal perspective, the positive effect of digital transformation on ESG performance is more significant in larger-scale enterprises. In addition, digital transformation will further enhance ESG performance by promoting green innovation, i.e., green innovation has a mediating role in the relationship between the two factors. The findings of the study introduce new thinking on the factors that influence corporate ESG performance, advance relevant research and provide important references for corporate managers and government departments who are concerned about ESG performance to make appropriate decisions.