The Implications of Triple Transformation on ESG in the Energy Sector: Fuzzy-Set Qualitative Comparative Analysis (fsQCA) and Structural Equation Modeling (SEM) Findings

Abstract

Digital transformation has emerged as a key driver of business innovation and growth in the 21st century. As organizations increasingly rely on digital technologies to operate and interact with customers, digital transformation has become an essential strategy for remaining competitive in today’s rapidly evolving business landscape. Simultaneously, the relevance of environmental, social, and governance (ESG) issues has increased in the context of consumers, investors, and regulators, as the negative consequences of business activities on the natural environment and society become increasingly evident. In this research article, we examine the relationship between ESG and the triple transformation of business, people, and technology, as well as how organizations can use digital technologies to enhance their ESG performance. Our aim is to identify the principal drivers and mechanisms that shape ESG performance in the context of triple transformation and to investigate the trade-offs and synergies between different ESG dimensions. We used a mixed-methods approach combining fuzzy-set qualitative comparative analysis (fsQCA) and structural equation modeling (SEM) to examine the implications of triple transformation on ESG in the energy sector. The results showed that triple transformation has positive impacts on ESG performance, depending on the specific context and the interaction between different drivers and mechanisms. We suggest that energy companies that are able to effectively navigate the challenges and opportunities of triple transformation are likely to outperform their peers in terms of ESG performance. Our study contributes to the literature on ESG in the energy sector by providing a nuanced and dynamic view of the relationships between triple transformation and ESG performance.

The Impact of Digital Transformation on ESG: A Case Study of Chinese-Listed Companies

“…Hence, companies lack sufficient motivation to promote ESG practices. Although there is a certain degree of inconsistency between the two in terms of goals, most scholars believe that digital transformation can help improve a company's ESG performance [19][20][21]. Wang and Esperança [22] and Lu, et al [23] have verified the incentivizing effect of digital transformation on corporate ESG performance from the perspectives of listed companies and SMEs, respectively.…”

Economic Analysis and Policies for the Environment, Natural Resources, and Energy

“…It was concluded that green growth strategies could reduce the ESG performance, and even worse, this negative impact accelerates over time. Moreover, Nitlarp and Mayakul [9] examined the relationships between ESG and the triple-people, business, and technology-transformation. A mixed-methods approach was utilized in the analysis through the combination of (i) fuzzy-set qualitative comparative analysis (fsQCA) and (ii) structural equation modeling (SEM).…”