The Impact of Green Transformation on ESG Performance in Manufacturing Enterprises: Empirical Evidence from Listed Companies in China

In the context of global sustainable development and China’s “Dual Carbon” goals, green transformation has emerged as a crucial pathway for manufacturing enterprises to enhance their ESG performance. This study develops a comprehensive and novel framework for assessing green transformation and uses panel data from Chinese A-share listed manufacturing firms spanning 2009 to 2022 to systematically evaluate the impact of this transformation on ESG performance. It also investigates the moderating effects of financing constraints, firm size, and digital transformation. The empirical findings reveal three key results. First, green transformation exerts a significant positive influence on corporate ESG performance, and this conclusion remains robust after conducting multiple endogeneity and sensitivity tests. Second, the beneficial effect of green transformation is more pronounced in state-owned enterprises, firms in central, western, and northeastern China, and younger enterprises. This reflects the substantial impact of policy orientation and resource base on the effectiveness of implementing green strategies. Third, financing constraints amplify the ESG benefits derived from green transformation. In contrast, firm size exhibits a negative moderating effect, indicating that small- and medium-sized enterprises (SMEs) derive greater advantages. Although digital transformation generally enhances ESG performance, it presents a synergistic imbalance with green transformation that diminishes its marginal effect. This study provides theoretical foundations and robust empirical evidence to support the advancement of corporate ESG performance through initiatives focused on green transformation.