AI Adoption and Corporate ESG Performance: Evidence from Chinese Listed Companies

Abstract

With the rapid development of artificial intelligence technology and increasing attention to corporate environmental, social, and governance performance, this study investigates the impact of AI adoption on firms' ESG performance in the Chinese context. Based on the sample of Chinese A-share listed companies from 2009 to 2020, this paper uses the method of textual analysis based on annual reports to examine how AI implementation affects corporate ESG ratings. The results indicate that the extent of AI-related information disclosed in corporate annual reports is significantly and positively related to their ESG ratings. Further analysis shows that this positive relationship holds after controlling for firm characteristics and conducting various robustness tests using alternative measures of AI adoption. The research enriches the literature on the determinants of ESG performance by providing new evidence on the role played by AI technology in enhancing corporate sustainability, and offers practical implications for corporate managers and policymakers on how to use AI technology in improving ESG performance and achieving the goals of sustainable development.