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Can digital finance curb corporate ESG decoupling? Evidence from Shanghai and Shenzhen A-shares listed companies

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  • Hua Liu

    (Nanjing Audit University)

  • Juncheng Wang

    (Nanjing Audit University)

  • Mengna Liu

    (Nanjing Audit University)

Abstract

As green development gains traction, digital finance, a major engine of the economy, plays a conducive role in improving green total factor productivity. Against this backdrop, avoiding corporate ESG decoupling is essential in the pursuit of green and quality development of enterprises. With data from Shanghai and Shenzhen A-share listed companies from 2016 to 2022, this study explores the impact of digital finance on corporate ESG decoupling, and the findings reveal that digital finance can suppress corporate ESG decoupling, and the effect is significant at the 1% level. Specifically, digital finance curbs corporate ESG decoupling by alleviating financing restraints on enterprises, increasing investment efficiency, improving the quality of information disclosure, and minimizing managerial myopia; the effect is more pronounced in non-state-owned enterprises, high-tech enterprises, and heavy-polluting enterprises; second, investor attention positively moderates the effect of digital finance on corporate ESG decoupling. The research findings are expected to provide an empirical basis and policy recommendations to allow digital finance to play a more effective role in leading enterprises to healthy and quality development.

Suggested Citation

  • Hua Liu & Juncheng Wang & Mengna Liu, 2024. "Can digital finance curb corporate ESG decoupling? Evidence from Shanghai and Shenzhen A-shares listed companies," Palgrave Communications, Palgrave Macmillan, vol. 11(1), pages 1-15, December.
    • Handle: RePEc:pal:palcom:v:11:y:2024:i:1:d:10.1057_s41599-024-04135-6
    DOI: 10.1057/s41599-024-04135-6
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