Volume 24

Dr.Cheng Xu Nanging University China Submission date: 13.10.2025. Accepted date: 23.04.2026. Publicaion date: 08.06.2026 Abstract: This paper examines the extent to which digital transformation and green innovation contribute to achieving sustainable performance. A descriptive approach was employed to identify relevant concepts, alongside a review of existing literature. Our study’s findings suggest that digital transformation can improve the quality and quantity of green innovations, particularly in state-owned enterprises and large companies. Green innovation can also contribute to sustainable performance through positive effects arising from customer pressure, resources and capabilities, and management commitment and orientation towards sustainability.  Furthermore, digital transformation may contribute to sustainable performance both directly and indirectly via green innovation practices. However, institutions may face various challenges when adopting digital transformation to achieve green innovation and sustainable performance, including technological, organisational and environmental barriers. Accordingly, the study recommends paying greater attention to, and demonstrating greater commitment to, environmental sustainability in order to effectively link digital transformation, green innovation, and sustainable performance. It also emphasises the need to direct digital transformation towards achieving economic and social performance while closing the gap with environmental performance.  Furthermore, the study emphasises the importance of developing suitable mechanisms to address the challenges faced by institutions in this area. It also calls for a deeper understanding of digital transformation to enable it to play a vital role in sustainable transformation, and for the research gap between digital transformation, green innovation and sustainable performance to be closed. These recommendations serve as a roadmap for future research and practical implications for organisations seeking to overcome these challenges. Finally, this article enriches the existing literature on digital transformation, green innovation and sustainable performance by providing valuable insights for researchers and practitioners in this field.  Keywords: digital transformation, green innovation, sustainable performance.  Introduction As digital technology has gradually developed and grown in popularity, large companies have begun to adopt digital transformation as a crucial strategic decision. Managers therefore need to understand and apply this new management tool in order to address various issues, such as environmental problems (Jiang, 2025, p. 1).  The phenomenon of “Industry 4.0” has emerged. The ‘4’ in ‘Industry 4.0’ reflects the four-directional development orientation of the industrial revolution. The first industrial revolution was steam-powered, the second was powered by electricity, the third was based on automation, and the fourth is centred on the integration of the Internet of Things, intelligent robots, artificial intelligence, virtual reality and other digital technologies. There are billions of connected devices that enable rapid and flexible interaction between humans and intelligent robots. Thanks to digital transformation, Industry 4.0 is rapidly taking shape and has become one of the most widely discussed concepts worldwide (Zahra & Shafay, 2024, p. 90).  Digital transformation also alters the traditional innovation process. Firms can use digital technologies to integrate key elements of multiple value-chain relationships within the innovation process, thereby reducing innovation time and costs while ultimately improving performance. Additionally, ‘smart’ transformation in organisations significantly enhances the quantity and quality of green innovation while strengthening technological innovation in new energy firms. Digitally mature organisations cultivate innovation-centred cultures that embed experimentation and organisational learning. This establishes adaptive frameworks that enable rapid responses to technological and market disruptions (Guo, Chen & Chen, 2025, p. 3). Recent Academic Focus on Digital Transformation and Sustainability Recent academic studies have increasingly focused on the relationship between digital transformation and sustainability performance. Some research suggests that digital technologies such as big data analytics and the Internet of Things (IoT) can significantly improve sustainability outcomes by reducing resource consumption and enhancing decision-making processes (Wenting & Yahya, 2024, p. 232). Digital transformation is a driver of environmental sustainability, enabling firms to adapt production processes and design eco-friendly products in response to environmental concerns. Consequently, digital transformation has become a vital enabler for manufacturers seeking to enhance sustainability. It provides alternative means to support decision-making, improve processes to increase resource-use efficiency, foster innovation in green technologies, enhance supply-chain transparency and empower consumers to make more sustainable choices (Asbeetah, Alzubi & Khadem, 2025, p. 2). Synergy between digital transformation and green innovation Digital transformation and green innovation have emerged as key corporate strategies for achieving sustainable development. Companies and governments are increasingly recognising the importance of environmental stewardship, not only through governmental policy, but also by integrating green principles into their operational practices. At the same time, firms that adopt digital transformation not only improve operational efficiency, but also achieve optimal resource utilisation and recycling, thereby promoting sustainable growth. This highlights the synergy between technology and environmental protection as a principal driver of healthy global socio-economic and ‘green’ development (Zhang, 2024, p. 70). Based on the above, the following research problem can be formulated: Research Problem:  To what extent do digital transformation and green innovation contribute to achieving sustainable performance? Study hypotheses:  – Digital transformation contributes to achieving sustainable performance.  Green innovation contributes to achieving sustainable performance.  – Digital transformation and green innovation contribute jointly to achieving sustainable performance.  From the research problem, the following sub-questions are proposed:  Study objectives The objectives of this study are as follows:   Study Methodology This study employed a descriptive approach and a literature review methodology. Specifically, prior studies were reviewed to investigate the relationship between digital transformation, green innovation and sustainable performance, and to determine the extent to which digital transformation and green innovation contribute to achieving sustainable performance. A set of relevant studies on the same topic were analysed. First: Digital transformation, green innovation and sustainable performance  1. Digital Transformation  1.1 Definition of digital transformation Digital transformation, both as a business process and as a term used to describe organisational activities related to the information technology sector, has roots dating back to the mid-twentieth century. The development of early computers and the conversion of analogue data into digital content altered the course of technological progress (Lozic & Čiković, March 2024, p. 327).  Lucas et al. (2013) defined digital transformation as ‘a radical change in the traditional ways of conducting business by redefining business capabilities, processes, and relationships’ (Pucihar et al.,