Managerial Myopia, Willingness for Proactive Risk-Taking, and Digital Transformation in Commercial Banks: Evidence from China

Digital transformation in commercial banks is a critical enabler of modern financial development. While technological advancement and resource allocation are key drivers, managerial attributes also play a decisive role in shaping transformation trajectories. Managerial myopia—often arising from short-term performance pressures, evolving regulatory expectations, and cyclical macroeconomic conditions—warrants particular attention. This study examines how managerial myopia constrains banks’ digital transformation by analyzing its direct impact, underlying behavioral mechanisms, and contingent boundary conditions. Using panel data from 55 Chinese listed commercial banks from 2010 to 2021, we construct a text-based measure of managerial myopia through linguistic analysis of annual reports and employ fixed-effects models for estimation. The results show that a short-term managerial orientation significantly impedes digital transformation, primarily by reducing banks’ propensity for proactive risk-taking. However, this inhibitory effect weakens when managers anticipate longer tenures, management teams exhibit greater diversity in overseas experience and functional expertise, or the average educational level is higher. Moreover, the adverse effects are less pronounced in larger banks and those with stronger corporate governance. Increased external scrutiny and intensified market competition further mitigate this negative influence. These findings offer actionable insights for banking stakeholders aiming to strengthen governance, extend managerial time horizons, and foster an innovation-oriented culture conducive to sustained digital advancement.