Digital Transformation as a Financial Value-Conversion Capability: Moderating the Link Between Corporate Energy Transition and Financial Performance in Indonesia

Abstract

Background: Corporate energy transition can create efficiency, financing, and valuation benefits, but it also exposes firms to implementation, information, and transition risks. This study examines whether digital transformation helps firms convert energy-transition strategies into financial value. Unlike prior studies that mainly treated digitalization or sustainability as broad direct predictors, this study examines an implementation-based, multidimensional digital capability as a boundary condition across three distinct energy-transition strategies and both accounting- and market-based financial outcomes. Methods: Using an unbalanced panel of 30 firms associated with Indonesia’s LQ45 Low Carbon Leaders Index (120 firm years, 2020–2025), we construct a 30-item implementation-based Digital Transformation Index and estimate two-way fixed-effects models with firm-level wild-cluster-bootstrap inference, conditional marginal effects, false-discovery-rate adjustment, and prespecified robustness checks. Results: Clean energy use is positively associated with return on assets, return on equity, and Tobin’s Q. Low-carbon operational efficiency is most clearly associated with return on assets, whereas renewable energy use is primarily reflected in Tobin’s Q. Digital transformation is positively associated with all three outcomes and selectively strengthens the financial effects of the three transition strategies. Conclusions: Digital transformation is not a universal performance amplifier. It functions as a strategy- and outcome-specific value-conversion and risk-management capability that improves the monitoring, coordination, financing, verification, and communication of energy-transition investments.