Enterprise Environment, Social, Government, Digital Transformation, and Enterprise Performance - Examining the Moderating Effect of Digital Transformation

School of Economics and Management, Shihezi University, Shihezi, China

^* Corresponding author: 20231016032@stu.shzu.edu.cn

Abstract

In the paper, the connection between enterprise performance, digital transformation, and ESG performance is discussed where the impact of digital transformation in regulation is pointed out. Through theoretical analysis, ESG practice may impact enterprise performance due to increasing investment costs, while digital transformation is able to change the enterprise operation mode and improve efficiency. The study uses the Hausman test for empirical analysis. The results suggest negative relationships between ESG and enterprise performance, and this kind of correlation could be explained with the increase in the cost of investment at the beginning of ESG practice. In the meantime, its regulatory aspect in digital transformation also does not reveal any significance, and this fact can be either indicative of the infantile state of digital transformation in the formation of its impact in the context of the study under consideration, or of the intricacy of the nature of digital transformation impact upon the processes of the business and its efficiency in the allocation of the resources. This conclusion gives a new outlook of the enterprise to advertise the ESG strategy and digitization of business and also indicates the trend of further research in future related studies.