Digital finance and corporate ESG performance: the roles of financial mismatch and executive education level

Purpose This study aims to explore the relationship between digital finance (DIF) and corporate environmental, social and governance performance (ESGP), with a specific focus on the roles of financial mismatch and executive education level in shaping this relationship. Design/methodology/approach Using a sample of Chinese A-share listed companies from 2011 to 2022, the study investigates the relationship between DIF and corporate ESGP through a moderated mediation model. Findings First, DIF enhances corporate ESGP, which remains robust across multiple robustness tests. In addition, the association between DIF coverage breadth and corporate ESGP follows a U-shaped pattern. Second, DIF indirectly enhances corporate ESGP by fostering green innovation, alleviating financing constraints and addressing financial mismatches. Third, executive education levels strengthen the favorable influence of DIF on corporate ESGP and green innovation and amplify DIF’s ability to mitigate financing constraints. Fourth, the impact of DIF on ESGP shows regional differences but does not differ in ownership or industry. Originality/value This study contributes to existing literature by offering new insights into how DIF influences corporate ESGP. It emphasizes the crucial roles of financial mismatches and executive education levels in this process, which have been largely overlooked in previous research. The findings provide a deeper understanding of the mechanisms behind DIF’s impact on corporate sustainability and offer valuable implications for policymakers and corporate executives seeking to enhance ESGP through DIF.