Has enterprise digital transformation facilitated the carbon performance in Industry 4.0 era? Evidence from Chinese industrial enterprises

•Enterprise digital transformation has a facilitating effect on carbon performance.•This facilitating effect is stronger in non-state-owned and large enterprises.•This facilitating effect is stronger in eastern and resource-based cities.•Enterprise digital transformation improves carbon performance via four channels. Continuing energy consumption is a major cause of global warming, and currently carbon neutrality is increasingly becoming an important task for low-carbon development. Based on the context of Industry 4.0, this paper explores whether enterprise digital transformation (DT) can enhance its carbon performance using industrial enterprise data from 2012 to 2020 in China. It is found that DT is significantly positive impact its carbon performance, and the findings are still valid after the robustness assessment. The channel test uncovers that enterprises in the process of digital transformation can enhance their innovation capacity, improve factor allocation efficiency, increase research and development (R&D) investment and optimize supply chain structure, thus raising their carbon performance. Heterogeneity analysis uncovers that the facilitating impact of DT on carbon performance is more pronounced in eastern, highly market-oriented and resource-based regions. Additionally, this promotion effect is also stronger in non-state-owned enterprises and large enterprises. The current research uncovers the benefits of DT for low-carbon development at the micro-level and provides relevant policy insights to further promote DT and enhance carbon performance in Industry 4.0 era.