A Systems Lens on Digitalization and ESG Performance: Empirical Evidence from Chinese Agricultural Firms

Agricultural enterprises serve as the cornerstone of food security. However, they operate under significant resource constraints and environmental risks. Adopting a systems lens, this study examines digitalization as a critical variable reshaping the input–output logic of agribusinesses. Using a longitudinal panel dataset of Chinese listed agricultural firms from 2013 to 2022 and Ordinary Least Squares regression, the study empirically identifies the mechanisms driving ESG performance. The results demonstrate that digitalization significantly enhances overall ESG performance, functioning as a governance mechanism that improves internal resource integration and transparency. Critically, the moderation analysis reveals a dynamic substitution relationship among system elements. Traditional inputs, specifically management expenses, financial slack, and intangible assets, exert significant negative moderating effects. This confirms the logic of factor substitution, suggesting that as digitalization advances, traditional governance modes relying on high administrative costs face diminishing marginal returns. In the environmental dimension, digitalization facilitates a transition from post-event remediation to whole-process control through intelligent traceability, effectively internalizing external constraints and reducing waste emissions. Additionally, heterogeneity analysis highlights significant structural variations. The ESG-enhancing effect of digitalization is more pronounced in firms characterized by high financial leverage, low long-term debt, and low industry concentration. Spatially, the marginal improvement is stronger in Western regions compared to the East, underscoring the Hu Huanyong Line as a critical structural boundary. Ultimately, digitalization serves as a core governance element that drives the structural transformation from traditional operating paradigms to digital governance architectures, thereby providing a robust pathway for corporate sustainability.