A Strategic and Institutional Evaluation on the Precursors of Green and Digital Transformation: The Twin Transition

Abstract

In contemporary institutional and corporate environments, green and digital transformation are increasingly addressed as interconnected rather than separate processes. This twin transition reflects a strategic effort to align technological development with environmental sustainability and to integrate digital infrastructure with low-carbon and circular economy objectives. The growing importance of this process is associated with the need to improve eco-efficiency, productivity, operational flexibility, and long-term competitiveness. This study aims to provide an in-depth perspective on the multidimensional determinants of green and digital transformation by systematically evaluating the strategic and institutional precursors of the twin transition. It specifically seeks to identify the organizational, managerial, cultural, and technological conditions that enable institutions to align digital strategies with environmental goals and generate sustainable outcomes. The study adopts a conceptual and evaluative research design based on a systematic analysis of the current literature and empirical findings related to green transformation, digital transformation, and the twin transition. The analysis is interpretive and integrative, focusing on such determinants as digital leadership, organizational capability, strategic agility, corporate culture, employee well-being, technological synergy, and governance mechanisms. The findings indicate that the twin transition should be understood as an integrated ecosystem. Strategic convergence between digitalization and green management improves eco-efficiency, total factor productivity, and operational performance while supporting carbon reduction and circular economy practices. The results also show that digital leadership, organizational capability, and corporate culture constitute the three core pillars of successful transformation. In contrast, managerial myopia, weak institutional readiness, and unbalanced digitalization may limit the environmental effectiveness of digital investments. Successful twin transition requires strategic alignment, visionary leadership, institutional flexibility, human-centered management, and governance consistency. Digital transformation generates sustainable value only when it is embedded in environmental goals and supported by a coherent organizational system. Future studies may expand the empirical basis of twin transition by testing this framework across sectors and countries, as well as by examining the long-term effects of digital governance, workforce adaptation, and green innovation performance.