Silent actions: Digital transformation in private enterprises with state equity participation

We examine whether and how state equity participation affects digitalization efforts of privatelyowned enterprises (POEs). Using a sample of Chinese-listed POEs, we find that state equity participation in POEs inhibits digitalization-related disclosures, while concurrently promoting digital innovations. This unveils a scenario where these enterprises are "walking more but talking less." Further analyses indicate that concerns about heightened digitalization-related disclosures potentially harming economic interests lead POEs to reduce disclosures, mitigating proprietary costs, while state equity participation helps POEs obtain more government subsidies and bank loans. Our study provides valuable insights into how ownership heterogeneity shapes digitalization strategies of POEs.