Abstract
In the period following the global COVID-19 pandemic, financial sustainability has become critical for the survival of enterprises around the world. This paper investigates the mechanisms and implications of digital transformation on resilience from the perspective of financial sustainability, that is, financial resilience. Employing a sample of Chinese listed firms, the study documents that digital transformation was positively related to financial resilience in normal states due to improved internal corporate governance, increased analyst coverage, alleviated financial constraints, and reduced operation risk. The relationship was more significant for companies with digitally literate executives, non–state–owned companies, and high–tech companies. However, it was not significant during the period of the COVID-19 pandemic and for companies with consecutive losses and delisting warnings. These findings provide unique evidence to support the beneficial effects of digital transformation on corporate resilience and to identify strategies for strengthening financial sustainability.
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