Navigating the Dichotomy of Uncertainty in Green Innovation and Digital Supply Chains
Abstract
Amid growing environmental pressures and rapid technological disruption, understanding how digitalization reshapes corporate sustainability strategies has become increasingly vital. Supply chain digitalization (SCD) plays a pivotal role in enhancing firms' adaptive capacity, operational transparency, and innovation efficiency. This study provides a comprehensive empirical investigation into how SCD fosters corporate green innovation, utilizing panel data from Chinese A‐share listed companies from 2014 to 2024. By integrating insights from digital transformation theory and sustainable innovation frameworks, mainly, the study uncovers a strong positive correlation between the extent of SCD and green innovation performance. Economic policy uncertainty (EPU) is identified as a significant moderating factor that affects the strength and direction of this relationship. Further analysis indicates that SCD notably impacts green invention patents, particularly in contexts of high monetary policy uncertainty. Additionally, heterogeneity analysis reveals that this positive effect is more pronounced among larger firms, firms with lower female‐executive representation, state‐owned enterprises, and firms with older managerial teams and lower ownership concentration. The findings offer valuable recommendations for organizations integrating digital technologies into their sustainability strategies and propose policy‐level actions to promote digital ecosystems that facilitate environmentally responsible innovation.