Digitalization as a Factor of Company’s Sustainable Development
Keywords:
Digitalization, corporate social responsibility, ESG indicators, ESG risks, company’s sustainable developmentAbstract
Compliance with the concept of sustainable development is a common goal for company’s management today. Adhering to this strategy, company receives a number of competitive advantages, such as higher investing attractiveness, a positive image in society, compliance with the criteria of low-carbon development. Currently, the problem of integrating digital technologies into business processes is also relevant. This paper examines the impact of business environment digitalization on company’s activity in solving environmental, social and managerial problems. Using econometric modeling, the influence of digitalization on the ESG criteria, that characterize company’s sustainability, is investigated. The authors substantiated and tested the following hypotheses: (H1) companies operating in countries with a high level of digitalization are exposed to lower risks associated with environmental (H2), social (H3) and managerial (H4) problems. Separately, within the framework of this study, the hypothesis was put forward and tested that the impact of digitalization on the company’s sustainable development indicators is different in traditional industries and in non-manufacturing and high-tech industries. Regression analysis has shown that in countries with a more developed digital environment, companies are more sustainable in accordance with the environmental and social indicators of ESG. The potential connection between digitalization and indicators of sustainable corporate governance of companies has not been confirmed. The results of an additional econometric study on subsamples of companies from different industries revealed that companies in the heavy and extractive industries, as well as companies in the energy sector have greater potential to improve environmental and social indicators through digitalization. Despite a number of limitations, the results of the study can be used by management
in developing a strategy for the sustainable development of the company.
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