Artificial Intelligence and Corporate Sustainability: Evidence from China’s National Artificial Intelligence Innovation and Development Pilot Zone Policy

Artificial intelligence (AI) is increasingly reshaping corporate production and governance, raising the question of how policy can steer corporations toward sustainable development. This study treats the staggered implementation of China’s National Artificial Intelligence Innovation and Development Pilot Zone policy (AI Pilot Zone policy) as a quasi-natural experiment. Using data from Chinese listed companies from 2014 to 2024, we employ a multi-period difference-in-differences approach to identify the impact of the policy on corporate sustainable development performance (SDP) and to explore the underlying mechanisms. The results show that the AI Pilot Zone policy significantly improves corporate SDP, and this finding remains robust to a series of checks, including parallel trend tests, placebo tests, PSM-DID estimations, and tests addressing potential biases under staggered policy adoption. Heterogeneity analysis based on the TOE framework indicates that the policy effect is more pronounced among firms with higher R&D intensity, stronger internal control, and those located in regions with higher levels of digital inclusive finance. Mechanism analysis further suggests that dynamic capabilities, including innovation capability, adaptation capability, and absorptive capability, play important mediating roles in the relationship between the policy and corporate SDP. Overall, this study provides micro-level evidence on the sustainability effects of AI-oriented public policies and offers insights for improving policy design and corporate capability development.