A Review of Research on Corporate Digital Transformation and Its Capital Market Effects

Abstract

Digital transformation is a general project that combines digital technology with the real economy, and it has begun to affect the pricing efficiency and resource allocation functions of capital markets. Systematically explore the concept, measurement methods and transformation paths of corporate digital transformation in this paper, and then present the impact of this on the capital market in terms of stock prices, cost of capital and information disclosure quality. With the development of digitalisation, both the environment of information and the structure of corporate governance have changed; thus, stock price synchronicity, crash risk and mispricing have also been affected. All of the above can help to improve the disclosure of information and strengthen internal control; at the same time, innovation can also be introduced to reduce the cost of equity and debt financing. In short, digitalisation will improve the quality of information disclosure, and thus, the positive effect of "information governance" can be achieved to prevent illegal disclosure of information and enhance the accuracy of earnings forecasts.