Leveraging digitalization for sustainability: An affordance perspective

As the worldwide push for carbon neutrality, aided by digital technologies (DTs) accelerates, many companies have launched digital and environmental orientations as two major strategic goals. However, the current understanding of how these two goals can collectively affect sustainable performance (consisting of economic performance and environmental performance) is rather limited. Drawing upon the affordance theory, we propose process reengineering and DT-enabled eco-innovation as two factors that offer pathways for companies with the goals of digital and environmental orientations to achieve sustainable performance. Our empirical results from 210 Chinese companies indicate that digital orientation has significant positive relationships with both process reengineering and DT-enabled eco-innovation, whereas environmental orientation has significant positive relationship with process reengineering, but not with DT-enabled eco-innovation. More importantly, process reengineering and DT-enabled eco-innovation have significant positive relationships with sustainable performance. We contribute to the existing body of knowledge by theorizing a novel mechanism that, from an affordance perspective, extends the present understanding of digital and environmental orientations. Our study also helps companies effectively integrate their digital and green practices.