Evaluating the Influence of Cybersecurity on Sustainability Performance. Role of Digitalization Intensity and Board <scp>IT</scp> Expertise in Frankfurt Stock Exchange Firms

ABSTRACT Cybersecurity plays a pivotal role in promoting sustainability performance by protecting digital assets, maintaining operational continuity, and safeguarding stakeholder information. When effectively implemented, cybersecurity frameworks not only enhance a firm's reputation but also minimize the environmental and operational risks associated with system disruptions, thereby contributing to long‐term sustainability. This study examined the influence of cybersecurity on sustainability performance and explored how digitalization intensity and board IT expertise moderate this relationship. These two dimensions have received limited attention in prior research. Drawing on data from 341 non‐financial firms listed on the Frankfurt Stock Exchange between 2008 and 2024, obtained from the Bloomberg database, the study employed purposive sampling to ensure the inclusion of relevant firms. To address methodological concerns such as cross‐sectional dependence, slope heterogeneity, and endogeneity, advanced econometric models were applied, including the Augmented Mean Group (AMG), the Common Correlated Effects Mean Group (CCEMG), and the two‐step Difference Generalized Method of Moments (GMM). The findings revealed that cybersecurity exerts a significant positive effect on sustainability performance. Furthermore, both digitalization intensity and board IT expertise were found to strengthen this relationship, suggesting that firms with higher levels of digital integration and stronger governance structures are better positioned to translate cybersecurity investments into sustainable outcomes. Overall, the study highlights the need for organizations to embed cybersecurity considerations within their broader corporate strategy to enhance resilience, reinforce stakeholder trust, and foster long‐term operational and environmental sustainability.