Research on The Impact of Intelligent Manufacturing onEnterprise ESG Performance: Empirical EvidenceOf Economics from China
DOI:
https://doi.org/10.14419/m0f0bq97Keywords:
Intelligent Manufacturing; ESG Performance; Difference-In-Differences; Green Innovation; Resource Allocation Efficiency; Corporate Sustainability; Chi-naAbstract
Background: The integration of intelligent manufacturing technologies and corporate sustainability has emerged as a critical research frontier in the era of Industry 4.0. While Environmental, Social, and Governance (ESG) performance increasingly shapes corporate valuation and stakeholder relations, the economic mechanisms through which intelligent manufacturing influences ESG outcomes remain theoretically underdeveloped and empirically underexplored, particularly in emerging market contexts where institutional environments differ substantially from developed economies.
Methods: Exploiting China's Intelligent Manufacturing Pilot Demonstration Projects (IMPP) as a quasi-natural experiment, this study employs a staggered difference-in-differences (DID) design with 18,426 firm-year observations from 2,149 Chinese A-share manufacturing companies during 2009-2023. We examine direct effects using two-way fixed effects models, investigate mediating mechanisms through the Baron-Kenny approach supplemented by Sobel tests, and explore heterogeneous effects across ownership structures, pollution intensities, and competitive environments using split-sample analysis with Chow tests for coefficient equality.
Results: Intelligent manufacturing significantly enhances enterprise ESG performance (β = 0.245, p < 0.01), representing a 5.3% improvement relative to the sample mean. This finding demonstrates robust consistency across parallel trend tests, placebo simulations (500 iterations), propensity score matching (PSM-DID), and instrumental variable (IV-2SLS) estimations. Mechanism analysis reveals three significant transmission channels: green innovation (mediating 24.6% of total effect, β = 0.186, p < 0.01), resource allocation efficiency (16.6%, β = 0.142, p < 0.01), and synergistic governance (7.9%, β = 0.098, p < 0.05). Heterogeneity analysis demonstrates significantly stronger effects for non-state-owned enterprises (β = 0.312 vs. 0.168, χ² = 8.45, p < 0.01), heavy-polluting industries (β = 0.356 vs. 0.186, χ² = 12.67, p < 0.01), and high-competition markets (β = 0.298 vs. 0.152, χ² = 5.23, p < 0.05). Sub-dimensional analysis reveals that environmental performance benefits most substantially (β = 0.324), followed by social (β = 0.218) and governance (β = 0.142) dimensions.
Conclusions: This study establishes intelligent manufacturing as an economically significant pathway for enhancing corporate ESG performance in emerging markets, with heterogeneous effects contingent upon ownership structure, industrial characteristics, and competitive dynamics. These findings advance theoretical understanding of technology-sustainability linkages, provide empirical foundations for evidence-based industrial policy design, and offer practical guidance for managers navigating the dual imperatives of technological transformation and sustainable development.
References
Acemoglu, D., & Restrepo, P. (2018). The race between man and machine: Implications of technology for growth, factor shares, and employment. American Economic Review, 108(6), 1488-1542. https://doi.org/10.1257/aer.20160696.
Bai, X., Han, J., Ma, Y., & Zhang, W. (2024). ESG performance, institutional investors, and corporate social responsibility: Evidence from Chinese listed companies. Journal of Cleaner Production, 437, 140732. https://doi.org/10.1016/j.jclepro.2024.140732.
Bénabou, R., & Tirole, J. (2010). Individual and corporate social responsibility. Economica, 77(305), 1-19. https://doi.org/10.1111/j.1468-0335.2009.00843.x.
Berg, F., Kölbel, J. F., & Rigobon, R. (2022). Aggregate confusion: The divergence of ESG ratings. Review of Finance, 26(6), 1315-1344. https://doi.org/10.1093/rof/rfac033.
Broadstock, D. C., Chan, K., Cheng, L. T., & Wang, X. (2021). The role of ESG performance during times of financial crisis: Evidence from COVID-19 in China. Finance Research Letters, 38, 101716. https://doi.org/10.1016/j.frl.2020.101716.
Chen, Z., & Xie, G. (2022). ESG disclosure and financial performance: Moderating role of ESG investors. International Review of Financial Anal-ysis, 83, 102291. https://doi.org/10.1016/j.irfa.2022.102291.
Dimson, E., Karakaş, O., & Li, X. (2015). Active ownership. The Review of Financial Studies, 28(12), 3225-3268. https://doi.org/10.1093/rfs/hhv044.
Drempetic, S., Klein, C., & Zwergel, B. (2020). The influence of firm size on the ESG score: Corporate sustainability ratings under review. Journal of Business Ethics, 167(2), 333-360. https://doi.org/10.1007/s10551-019-04164-1.
Dyck, A., Lins, K. V., Roth, L., & Wagner, H. F. (2019). Do institutional investors drive corporate social responsibility? International evidence. Journal of Financial Economics, 131(3), 693-714. https://doi.org/10.1016/j.jfineco.2018.08.013.
Eccles, R. G., Ioannou, I., & Serafeim, G. (2014). The impact of corporate sustainability on organizational processes and performance. Management Science, 60(11), 2835-2857. https://doi.org/10.1287/mnsc.2014.1984.
Flammer, C. (2021). Corporate green bonds. Journal of Financial Economics, 142(2), 499-516. https://doi.org/10.1016/j.jfineco.2021.01.010.
Friede, G., Busch, T., & Bassen, A. (2015). ESG and financial performance: Aggregated evidence from more than 2000 empirical studies. Journal of Sustainable Finance & Investment, 5(4), 210-233. https://doi.org/10.1080/20430795.2015.1118917.
Gillan, S. L., Koch, A., & Starks, L. T. (2021). Firms and social responsibility: A review of ESG and CSR research in corporate finance. Journal of Corporate Finance, 66, 101889. https://doi.org/10.1016/j.jcorpfin.2021.101889.
He, F., Du, H., & Yu, B. (2023). Corporate ESG performance and manager misconduct: Evidence from China. International Review of Financial Analysis, 87, 102550. https://doi.org/10.1016/j.irfa.2022.102201.
Hong, H., & Kacperczyk, M. (2009). The price of sin: The effects of social norms on markets. Journal of Financial Economics, 93(1), 15-36. https://doi.org/10.1016/j.jfineco.2008.09.001.
Huang, G., He, L., & Lin, X. (2022). Robot adoption and energy performance: Evidence from Chinese industrial firms. Energy Economics, 107, 105837. https://doi.org/10.1016/j.eneco.2022.105837.
Kang, H. S., Lee, J. Y., Choi, S., Kim, H., Park, J. H., Son, J. Y., Kim, B. H., & Noh, S. D. (2016). Smart manufacturing: Past research, present findings, and future directions. International Journal of Precision Engineering and Manufacturing-Green Technology, 3(1), 111-128. https://doi.org/10.1007/s40684-016-0015-5.
Li, T., Wang, K., Sueyoshi, T., & Wang, D. (2021). ESG: Research progress and future prospects. Sustainability, 13(21), 11663. https://doi.org/10.3390/su132111663.
Lins, K. V., Servaes, H., & Tamayo, A. (2017). Social capital, trust, and firm performance: The value of corporate social responsibility during the financial crisis. The Journal of Finance, 72(4), 1785-1824. https://doi.org/10.1111/jofi.12505.
Liu, M., & Liu, Y. (2023). Digital transformation and enterprise ESG performance. Finance Research Letters, 58, 104370. https://doi.org/10.1016/j.frl.2023.104370.
Luo, W., Guo, X., Zhong, S., & Wang, J. (2024). Environmental, social, and governance performance and corporate green innovation. Business Strategy and the Environment, 33(2), 1122-1140. https://doi.org/10.1002/bse.3538.
Minutolo, M. C., Kristjanpoller, W. D., & Stakeley, J. (2019). Exploring environmental, social, and governance disclosure effects on the S&P 500 financial performance. Business Strategy and the Environment, 28(6), 1083-1095. https://doi.org/10.1002/bse.2303.
Shen, H., Lin, H., Han, W., & Wu, H. (2023). ESG in China: A review of practice and research, and future research avenues. China Journal of Ac-counting Research, 16(4), 100325. https://doi.org/10.1016/j.cjar.2023.100325.
Sun, H., & Saat, N. A. M. (2023). How does intelligent manufacturing affect enterprise ESG performance?—Evidence from China. Sustainability, 15(4), 2898. https://doi.org/10.3390/su15042898.
Wang, K., Li, T., San, Z., & Gao, H. (2023). How does digital transformation affect corporate ESG performance? Evidence from China. Finance Research Letters, 58, 104370. https://doi.org/10.1016/j.frl.2023.104370.
Wu, S., Li, X., Du, X., & Li, Z. (2024). Digital transformation and corporate ESG performance: Evidence from China. PLoS ONE, 19(4), e0302029. https://doi.org/10.1371/journal.pone.0302029.
Xie, J., Nozawa, W., Yagi, M., Fujii, H., & Managi, S. (2019). Do environmental, social, and governance activities improve corporate financial per-formance? Business Strategy and the Environment, 28(2), 286-300. https://doi.org/10.1002/bse.2224.
Zhai, H., Yang, M., & Chan, K. C. (2022). Does digital transformation enhance a firm's performance? Evidence from China. Technology in Society, 68, 101841. https://doi.org/10.1016/j.techsoc.2021.101841.
Zhang, M., Chen, M., & Tong, L. (2023). Industrial robots and labor productivity: Evidence from Chinese manufacturing. Economics of Transition and Institutional Change, 31(3), 787-817. https://doi.org/10.1111/ecot.12353.
Zheng, W., & Bu, X. (2024). ESG, digital transformation and firm performance—moderating role of digital strategy. SAGE Open, 14(1). https://doi.org/10.1177/21582440241291680.
Zhong, R. Y., Xu, X., Klotz, E., & Newman, S. T. (2017). Intelligent manufacturing in the context of Industry 4.0: A review. Engineering, 3(5), 616-630. https://doi.org/10.1016/J.ENG.2017.05.015.
Zhou, G., Liu, L., & Luo, S. (2022). Sustainable development, ESG performance and company market value: Mediating effect of financial perfor-mance. Business Strategy and the Environment, 31(7), 3371-3387. https://doi.org/10.1002/bse.3089.
Downloads
Published
Issue
Section
License
Authors who publish with this journal agree to the following terms:
- Authors retain copyright and grant the journal right of first publication with the work simultaneously licensed under a Creative Commons Attribution License that allows others to share the work with an acknowledgement of the work's authorship and initial publication in this journal.
- Authors are able to enter into separate, additional contractual arrangements for the non-exclusive distribution of the journal''s published version of the work (e.g., post it to an institutional repository or publish it in a book), with an acknowledgement of its initial publication in this journal.
- Authors are permitted and encouraged to post their work online (e.g., in institutional repositories or on their website) prior to and during the submission process, as it can lead to productive exchanges, as well as earlier and greater citation of published work (See The Effect of Open Access).