Mongkhol Moolkham
This study investigates how digital transformation affects firm valuation via financial performance, highlighting the moderating role of environmental risk, namely temperatures and PM2.5 concentration. It employs panel data from companies listed on the Stock Exchange of Thailand and utilizes partial least-squares structural equation modeling (PLS-SEM) for analysis. The results indicate that both core digital technologies and applications have a positive and direct influence on financial performance and firm valuation, aligning with the national "Thailand 4.0" agenda. Additionally, the analysis suggests that improved financial performance serves as the primary mechanism by which digital transformation enhances firm value. However, this research presents a significant paradox to existing literature. While previous studies propose that environmental risk can drive corporate digital adoption, the findings demonstrate that these same risks diminish the efficiency of the value-creation process. The study reveals that environmental risk not only directly undermines financial performance and firm value but, more critically, significantly reduces the positive, performance-mediated effect of digital transformation on firm value. This study advances key theoretical perspectives by showing that the value of digital assets is conditional on organizational resilience, reinforcing the resource-based view, contingency theory, and dynamic capabilities theory. It also extends signaling and stakeholder theories by highlighting the critical role of environmental context in shaping investor responses and strategic outcomes. The study suggests that, in an era characterized by increasing environmental risk, dependence solely on technology is insufficient. Firms must integrate environmental resilience to successfully convert digital transformation into sustainable long-term value gains.