Digital transformation for corporate ESG performance: configurations of applied digital technologies and digital technology application scenarios

Purpose Environmental, social and governance (ESG) performance improvement has become increasingly prioritized by firms, and digital transformation is often employed to achieve ESG objectives. Drawing from the resource orchestration theory, this study explores how various digital transformation aspects – including applied digital technologies (ADTs) and digital technology application scenarios (DTASs) – interact to generate high ESG performance. Design/methodology/approach Using a Chinese sample of 960 firm-year observations from 2011 to 2021, we apply fuzzy-set qualitative comparative analysis (fsQCA) to explore configurations leading to high ESG performance. Findings The results show that multiple configurations can achieve high ESG performance and these configurations are categorized as technology-oriented, application-oriented and balanced ones. We also find that the configurations for each performance dimension are not identical. Moreover, four configurations are found to collectively generate high ESG performance across all dimensions. Originality/value Previous research on the relationship between digital transformation and ESG performance typically considered digital transformation as a whole or examined the isolated impacts of individual ADTs. Adopting a configurational approach, this study complements the literature by investigating the synergistic effects of various digital transformation aspects on ESG performance. The findings offer managerial insights for firms into effectively deploying digital transformation for ESG goals.