Can Digital Transformation Promote Corporate Resilience Growth?

In an increasingly uncertain business environment, digital transformation (DT) may help firms withstand external shocks and sustain long-term development. This study examines whether and how DT enhances corporate resilience (CR), conceptualized in terms of resistance ability and growth ability. Using panel data on Chinese listed firms from 2010 to 2022, DT is measured through annual-report text analysis. Firm- and year-fixed-effects regressions, instrumental-variable estimation, mediation analysis, and heterogeneity tests are employed to assess the effect of DT on CR and explore the underlying mechanisms. Empirical outcomes demonstrate that DT has excellent potential in empowering corporates to withstand external environment crises and gain long-term competitive advantage. This indicates that DT contributes to improving CR. Regarding transmission mechanisms, DT can improve the management innovation level with its powerful penetration and restructuring functions. This improvement in internal control capabilities significantly enhances CR. The heterogeneity outcomes demonstrate that the promotion impact of DT on CR is more particularly pronounced among non-high-tech companies, firms with high financing constraints, and enterprises operating in intense industry competition. These insights support governments in formulating digital-related policies and provide evidence for encouraging enterprises to enhance the application of digital technology and improve their resilience.