Can sharing auditors with customers improve suppliers digital transformation?

Area of Science:

• Business and Management
• Information Systems
• Auditing

Background:

• Digital transformation is crucial for high-quality development and national strategies.
• Understanding factors influencing enterprise digital transformation is essential.

Purpose of the Study:

• To investigate the impact of shared auditors between customers and suppliers on supplier digital transformation.
• To explore the mechanisms through which shared auditors influence this process.

Main Methods:

• Empirical analysis of China's A-share listed companies from 2007 to 2021.
• Examining the relationship between shared auditors and supplier digital transformation.

Main Results:

• Sharing auditors with customers positively impacts supplier digital transformation.
• The effect is more pronounced for suppliers with weaker bargaining power, lower media visibility, and higher auditor industry expertise.
• Mechanisms include enhanced supervision and alleviated financing constraints.

Conclusions:

• Shared auditors serve as a catalyst for supplier digital transformation.
• This transformation, facilitated by shared auditors, can lead to increased innovation.
• Findings offer empirical support for overcoming digital transformation challenges.