Does Digitization Drive Corporate Social Responsibility?

The report of the 19th National Congress clearly puts forward that China’s economy has shifted from the stage of high-speed growth to the stage of high-quality development.At the same time,the digital economy was also written into the 19 th Party Congress report,elevated to a national strategic perspective.The second tenth report proposed: "accelerate the development of the digital economy,promote the deep integration of the digital economy and the real economy,to create an internationally competitive digital industry cluster.The digital economy occupies an increasingly important position in the strategic layout of China’s economic development,and top-level planning continues to promote the in-depth development of China’s digital economy.In the context of the development of the digital economy industry big data,cloud computing,blockchain,artificial intelligence,and other emerging technologies have also had a transformative impact on the way enterprises operate,and more and more traditional enterprises have begun to make attempts at digital transformation.Enterprises use digital technology to carry out digital transformation,stimulate their innovative energy,improve the level of innovation,improve their production efficiency,etc.And in this process of rapid economic development,it is also important to focus on the high-quality development of the economy.High-quality development means that enterprises should fulfill more social responsibilities.In the process of development,more and more enterprises recognize and take the initiative to assume corporate social responsibility.In recent years,frequent environmental pollution problems and food safety problems have forced enterprises to better fulfill their corporate social responsibility.What is the relationship between enterprises’ digital transformation and their corporate social responsibility?First of all,the research idea of this thesis is as follows: Firstly,through a literature review and summary of domestic and foreign scholars’ research,the definition of digitalization,the impact of digitalization,and the metrics and indicators of the degree of digitalization are summarized respectively.The definition of CSR,the motives,and influencing factors of CSR are summarized.Secondly,the possible empirical relationships between digitalization and CSR are sorted out,and the corresponding hypotheses are proposed.Thirdly,based on the corresponding theoretical analysis,an empirical test is conducted using an econometric model to explore the impact of corporate digital transformation on CSR with a sample of Chinese A-share listed companies from 2010 to 2020,and further discuss innovation,and analysts focus on the role of mechanisms that exist in the relationship between the two.Finally,through heterogeneity analysis of regressions,we further explore the differences in the contribution of corporate digital transformation to CSR performance among enterprises with different financing constraints,sizes,and asset cash flows,and finally propose effective policy recommendations on the digital transformation of enterprises and the better fulfillment of CSR by better enterprises.This thesis shows that:(1)digital transformation of enterprises can improve CSR performance,and the results remain robust after a series of endogeneity and robustness tests.(2)Corporate digital transformation is a way to promote corporate social responsibility by improving innovation inputs and outputs,stimulating corporate innovation dynamics,and improving innovation capabilities.(3)Corporate digital transformation is promoting corporate social responsibility by reducing the level of information asymmetry,thus promoting corporate social responsibility(4)The contribution of the level of corporate digital transformation to the level of corporate social responsibility is more pronounced in companies with low financing constraints,large scale,and high asset cash recovery rate.The marginal contributions of our study are as follows.Firstly,we enrich the literature on the non-financial impacts of digitization and CSR impact factors.Secondly,we theoretically analyze the contribution of digital transformation to corporate social responsibility performance and explain the impact channels from the perspective of innovative R&D.Generally speaking,companies need to invest a lot of capital and sunk costs to promote digital transformation,while R&D investment and CSR are also considered as "costs" to a certain extent.All three areas can erode a company’s profits,so why are companies willing to invest in them at the same time?Our mechanism reveals that digital transformation stimulates innovation,which in turn leads to increased CSR.The company can be said to have one input and multiple benefits.Thirdly,our heterogeneity analysis found that supports the classical explanation of why companies do CSR is that namely “doing good by doing well”,by addressing whether it is only well-performing firms that can afford investing in CSR.