The role of Industry 4.0 technologies in driving the financial importance of sustainability risk management

Research background: The climate crisis is one of the greatest challenges the world is facing in the 21st century. The global response to this problem must comprise transitions in land and ecosystems, energy, urban, infrastructure, and industrial systems and a transformation in enterprise and risk management. With the global pressure to fight climate change and achieve the Sustainable Development Goals, the innovative potential of Industry 4.0 technologies (blockchain, Big Data analytics, the Internet of Things, cloud computing, artificial intelligence, 3D additive manufacturing and technology platforms) has been subject to enormous interest among researchers and practitioners. Additionally, the COVID-19 pandemic has accelerated technology investment and digital transformation in many business areas, potentially including sustainability risk management. Purpose of the article: The purpose of this paper is to explore the scope of Industry 4.0 technology implementation in sustainability risk management and its financial impact. Methods: Based on the survey research, the authors verified if enterprises implementing Industry 4.0 technologies during the last five years are benefiting from their investment depending on the number of technologies. Due to the ordinal measurement scale of the analyzed variables, the verification of hypotheses was carried out using the Mann-Whitney U test. Findings & value added: In the opinion of the managers surveyed, the number of Industry 4.0 technologies implemented in the sustainability risk management process does not affect the enterprise's aggregate Financial Performance Indicator, individual financial indicators (ROA, ROE, OPM, NPM and FLR) and the enterprise's ability to manage financial risk. This study contributes to the literature on the technological transformation of the sustainability risk management process and its financial importance. The design and implementation of sustainable development strategies imply a long-term perspective, including the achievement of risk management effects in this area. The implementation of one technology, let alone two or more, is a difficult and time-consuming management challenge before synergy effects are achieved in an integrated technological eco-system.