The impact of board digital cognition on the execution quality of corporate ESG strategy

Vollständiger Abstract

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Against the background of deep integration between digital transformation and ESG governance, corporate ESG strategy no longer remains at the level of responsibility disclosure or image construction. It is gradually shifting toward target decomposition, resource allocation, process supervision, and performance improvement. As the core body of strategic decision-making and governance supervision, the board affects how firms understand ESG data, risk information, and execution processes through its level of digital cognition. Based on public disclosures of A-share non-financial listed companies from 2016 to 2023, the board digital cognition index can be constructed from directors' digital backgrounds, digital governance expressions, digital committee settings, and digital training disclosures. ESG strategy execution quality can be measured through target completion, quantitative disclosure, investment intensity, rating improvement, and penalty deductions. The baseline regression results show that board digital cognition has a significant positive effect on ESG strategy execution quality. The mechanism tests further show that internal control quality and digital investment strengthen this influence path. This finding indicates that board digital cognition not only reflects the upgrading of the governing body's knowledge structure, but also promotes the shift of ESG strategy from formal disclosure to substantive execution by improving information processing, supervisory constraints, and resource allocation.