How firm digitalization affects targeted poverty alleviation participation: a capability-based view

While firm digitalization has significantly shaped business conduct and performance, our understanding of how it affects firms’ engagement with social issues such as poverty alleviation remains underdeveloped. Drawing on information processing theory, we propose that digitalization empowers firms to undertake poverty alleviation responsibilities by enhancing their information processing capabilities. We further develop an integrative framework that highlights the synergetic effects between institutional pressures and firm capability portfolios. We argue that the positive impact of firm digitalization is stronger when institutional pressures are presented (i.e., government intervention and state ownership) and when firms possess complementary capabilities (i.e., innovation capability and operational flexibility). The results of our analysis of 2015–2020 panel data on Chinese listed firms provide strong support for our hypotheses. Overall, this study provides a capability-based view for the poverty alleviation research and informs policymakers a fresh new way to foster firms’ engagement in poverty alleviation.