PurposeWhile prior studies predominantly focus on the overall impact of digital transformation on environmental, social and governance (ESG) performance, this study employs dynamic capability theory to examine two different dimensions of digital transformation, namely digital transformation quantity and digital transformation structure, and how they influence the ESG performance of enterprises. The mediating roles of social attention and green innovation are investigated to further explore the underlying mechanisms.Design/methodology/approachThe authors apply fixed effects models and empirically test the hypotheses using samples of Chinese A-share listed companies from 2011 to 2020. In addition, difference-in-differences and instrumental variable methods are used in the robustness test.FindingsWhen digital transformation is categorized into quantity and structure, the impact mechanisms are found to be distinct. Externally, digital transformation quantity attracts social attention, aiding enterprises in evolutionary adaptability and acquiring resources to support ESG practices. Internally, digital transformation structure fosters green innovation, enabling enterprises to overcome technical obstacles and harness technology's potential to enhance their ESG performance.Originality/valueThis study contributes to the current knowledge by differentiating digital transformation into quantity and structure, which helps to further explore the mechanism of digital transformation on ESG and address the research gap. Meanwhile, the concept of adaptability in the dynamic capability theory is employed to construct the model, offering a deeper perspective and expanding the theory. This nuanced investigation of the mediating effects of social attention and green innovation elucidates how different dimensions of digital transformation contribute to the development and utilization of dynamic capabilities, thereby enhancing enterprises' ESG performance.
Purpose This article is a commentary on The "Global Implications of the Indigenous Epistemological System from the East: How to Apply Yin-Yang Balancing to Paradox Management" (Li, 2016), which is a timely and important piece. Li (2016) offers epistemological insights into what Yin-Yang is, why Yin-Yang can serve as a guiding frame of thinking, and how to apply this frame of thinking to paradoxical issues to organizations that compete in a complex cross cultural world. Western management philosophies and perspectives have dominated the mainstream theories in organization and management around the world over the past five decades, paying very limited attention and appreciation to Eastern philosophies that exist already for over 2500 years (e.g., 551–479 BC's Confucianism). In this commentary, we added more explanations, suggesting that given intensified complex and competing needs to fulfil for today's businesses, the indigenous Eastern epistemological wisdom of Yin-Yang balancing is an important guide to understand paradoxes and tensions. Yin-Yang balancing provides a holistic comprehension concerning our complex reality. It treats two opposite elements of any paradox as partial trade-off as well as partial synergy within a spectrum of holistic and dynamic balancing. We reinforce that the duality perspective has good potential to help us better understand the process of a multitude of conflictual and competing needs organizations must simultaneously accomplish. This potential is deemed to work not merely for firms competing in the East or other developing countries but can extend to organizations, large or small, in the West or developed countries as well.
Design/methodology/approach This commentary echoes Li's point (2016) that Yin-Yang balancing has significant and extensive applications when a growing number of organizations, local and foreign, are compelled to become ambidextrous when facing complex new business realities and having to deal with intensified competing needs they have to simultaneously, interactively and dynamically satisfy. This commentary discusses some distinctive characteristics of Eastern philosophies, followed by articulation of some critical lacuna, we think, concerning the Yin-Yang duality that should be answered. In this commentary, we amplify Li's main points, along with our suggested agenda for future research that can further develop Yin-Yang balancing to a theory of managing paradox.
Findings Eastern philosophies have long been dominated by five pillars or five schools of mastery thoughts originating mainly from China – Confucianism (Ru Jia), Taoism (Tao Jia), Legalism (Fa Jia), Militarism (Bing Jia), and Buddhism (Fu Jia). The Yin-Yang philosophy is one of the central notions of Taoism which teaches us how to act in accordance with nature. Founded by Laozi and Zhuangzhi, Taoism is rooted in an understanding of the "way" (i.e., Tao), which is the shapeless force that brings all things into existence and then nurtures them. That is, Tao means the natural course, which is spontaneous, eternal, nameless, and indescribable. Unlike Confucianism, Taoism favors philosophical anarchism and pluralism. Tao manifests itself through natural principles or philosophies, including Yin-Yang duality, circular nature of changes, wu-wei (natural course of action), and harmony with internal and external environments.
Research limitations/implications We endorse Li's view (2016) that Western and Eastern management philosophies have their respective strengths and weaknesses, neither one alone is sufficient to manage all types of problems. Thus, a better solution is the one that can integrate Eastern and Western epistemological systems into a geocentric meta-system. The world is entering into a globally-interconnected era, requiring both the organic complexity and ambiguity and the mechanistic simplicity and clarity. Increased global interconnectivity accentuates complexity and interdependence while increased competition fortifies dynamism and uncertainty. This will cause more, not less, paradoxes than before. To this end, Yin-Yang balancing is an audacious and judicious frame of thinking toward paradoxes because this philosophy embodies a unique ability to address the key challenges of ambiguity, complexity, and uncertainty and embraces multiplicity, diversity and inter-penetrability.
Practical implications After centuries of Western economic dominance, China, India and the rest of the East, alongside emerging economies more broadly, are beginning to challenge the West for positions of global industry leadership. At a deeper level, the transformation from "West Leads East" to "West Meets East" heralds the need for ambidextrous or ambicultural thinking: making simultaneous use of opposites, or simultaneously balancing seemingly contradictory forces and needs, such as efficiency and flexibility, competition and cooperation, stability and adaptation, exploitation and exploration, global and local, privatization and state-ownership, market-based and relationship-based strategies, individualism and collectivism, and long-term and short-term
Originality/value Enlightened by Yin-Yang balancing, there is a great potential of co-evolution, convergence and co-reinforcement of different philosophies. It will not be easy for any single study to reveal a roadmap for this, but it is feasible for the management research community to finally make the trip with our continuous and collective efforts. Some Western management theories, such as organizational ambidexterity, loose coupling, collaborative competitive advantage, co-opetition, transnational solution (integrated global integration and local responsiveness), to name a few, share some core values of Yin-Yang balancing, even though such sharing has never been articulated explicitly. Similar to the same difficulty facing any other philosophies to be transformed into actionable theories, we have a long journey to navigate in quest for extending Yin-Yang balancing to a universally accepted theory of managing paradoxes. Li's article (2016) sheds much light for us to forge ahead to this direction.
