Digitization is a megatrend that shapes the economy and society, driving major transformations. Enterprises, as the most important microeconomic entities, are critical carriers for society in conducting digital transformation and practicing sustainable development to achieve socioeconomic and environmental sustainability. Exploring the relationship and mechanisms between digital transformation and sustainable corporate development is crucial. This study investigates the influence of digital transformation on sustainable corporate development as well as its moderating mechanisms. A two-way fixed effects model is used on a research sample of Chinese A-share listed companies in Shanghai and Shenzhen from 2010 to 2020. Three methods are used for robustness testing to alleviate endogeneity issues. The empirical results show that digital transformation can significantly enhance sustainable corporate development, whereas empowered management and highly educated employees are essential complementary human resources that effectively strengthen the contribution of digitalization to sustainability. Additionally, internal controls are internal drivers that have a positive moderating effect on the digital transformation to improve corporate sustainability. This study reveals that digital transformation is an important tool for promoting corporate sustainability, broadening the literature in related fields, and providing insights for corporate management and government policymakers to advance corporate sustainability.

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