Abstract: Taking Shanghai and Shenzhen A-share listed companies from 2012 to 2021 as research objects,this paper explores the impact of digital transformation on the corporate dual agency-costs. The empirical study finds that the digital transformation has a notable inverted U-shaped impact on the corporate dual agency-costs,and that is,the digital transformation can only play a positive role in corporate governance when it reaches a certain level. It breaks through the linear cognition of the existing literature on the effect of digital transformation.Further exploratory research finds that executive monetary compensation can smooth the inverted U-shaped relationship between digital transformation and dual agency-costs and make the inflection point shift to the left,and that this adjustment effect is more significant in state-owned enterprises.However,executive equity-based incentives did not have any significant impact on the relationship between the two. This paper is beneficial to supplement the relevant research of digital transformation and corporate governance,and has important implications for promoting the construction of corporate incentive system in the digital era.

Key words: digital transformation, dual agency-costs, inverted U, executive incentives