Modernization of Kazakhstan’s agro-industrial complex based on digitalization and ESG

Kazakhstan’s agricultural sector faces increasing pressure from climate challenges, environmental, social, and governance (ESG) requirements, and the national course toward digital transformation. Understanding how ESG and digitalization impact financial performance is crucial for shaping future strategies.

The goal is to examine the impact of digital processes and ESG principles on the financial performance of agricultural enterprises in Kazakhstan.

Methods – using quantitative data from JSC "Atameken-Agro" for 2014–2023, the study assesses how digital modernization and ESG trends influence revenue, net profit, and return on assets (ROA). Empirical indicators are complemented by case analysis to reveal operational characteristics.

Results – the findings show that investment in ESG standards may initially raise depreciation costs but align with long-term sustainability goals. Digital modernization positively correlates with production outcomes, although its immediate impact is statistically insignificant. However, case studies demonstrate that digital tools help increase transparency in ESG practices and facilitate the spread of ecological innovations, which could generate tangible returns over time.

Conclusions – as Kazakhstan transitions to mandatory ESG reporting in 2025 and expands digital agriculture initiatives, a stronger long-term synergy between ESG and digital progress is expected. While current monetary effects remain ambiguous, effective government support and technological transformation will enhance this synergy. This research underscores the strategic importance of integrating ESG principles and investment in digitalization as key factors in the transformation of the agricultural sector.

1. [1] Xie, H., Lyu, X. (2022). Responsible Multinational Investment: ESG and Chinese OFDI. Economic Research Journal, 57(3), 83-99 [in English].

2. [2] Yang, P., Hao, X., Wang, L., Zhang, S., Yang, L. (2023). Moving toward sustainable development: The influence of digital transformation on corporate ESG performance. Kybernetes, 53(3), 669-687. https://doi.org/10.1108/K-03-2023-0521 [in English].

3. [3] Qin, X., Xie, G. (2024). Research on the impact of digital transformation on enterprise ESG performance. The EUrASEANs: Journal on Global Socio-Economic Dynamics, (1), 250-265 [in English].

4. [4] Katenova, M., Qudrat-Ullah, H. (2024). Corporate social responsibility and firm performance: Case of Kazakhstan. Heliyon, 10(10), e31580. https://doi.org/10.1016/j.heliyon.2024.e31580 [in English].

5. [5] Zhanaltay, Z. (2023). Agricultural development of Kazakhstan. Eurasian Research Journal, 5(4), 45-58. https://doi.org/10.53277/2519-2442-2023.4-03 [in English].

6. [6] Mondejar, M.E., Avtar, R., Diaz, H.L., et al. (2024). Digitalization to achieve sustainable development goals: Steps towards a Smart Green Planet. Science of the Total Environment, 794, 148539. https://doi.org/10.1016/j.scitotenv. 2021.148539 [in English].

7. [7] Weber, R., Frank, M., Braun, J. (2021). Digitalisation in agriculture and its impact on social sustainability. Agricultural Systems, 190, 74- 79. https://doi.org/10.18461/pfsd.2021.2009 [in English].

8. [8] Kaldiyarov, D.A., Kalymbekova, Zh.K., Zhumanazarov, K.B. (2023). Tsifrovaya innovatsionnaya ekosistema agropromyshlennogo kompleksa Kazakhstana: obzor predmetnoy oblasti [Digital innovation ecosystem of Kazakhstan's agro-industrial complex: subject area review]. Problemy agrorynka – Problems of AgriMarket, 3, 34-41. https://doi.org/10.46666/2023-3.2708-9991.03 [in Russian].

9. [9] Atameken -Agro (2023). Annual report. Available at: https://www.kase.kz/ru/listing/issuers/KATR (date of access: 12.03.2025) [in English].

10. [10] Aitas KZ (2023). ESG report. Available at: https://www.aitas.kz/press-centr/on-2023-performance-results-and-first-.esg-report (date of access: 12.03.2025) [in English].

11. [11] Government of Kazakhstan (2025). Kazakhstan intends to increase yields in agricul-ture by introducing digital technologies. Available at: https://www.primeminister.kz/en/news/kazakhstan-intends-to-increase-yields-in-agriculture-byintroducing-digital-technologies-29670 (date of access: 12.03.2025) [in English].

12. [12] Shalbayeva, A.R., Tamenova, S.S., Umbetaliev, A.D. (2024). Qazaqstannyń ağrarlıq sektorında ESG-tujyrymdamasyn qoldanu: basekeleştık artıqshylyqtar [Application of ESG concept in Kazakhstan's agricultural sector: competitive advantages]. Problemy agrorynka – Problems of AgriMarket, 2, 25-39. https://doi.org/10.46666/2024-2.2708-9991.02 [in Kazakh].

13. [13] Mohsin, A.F., Barlykbay, N., Mamanova, S. (2024). Scalability and integration challenges of IoT systems in Kazakhstan. International Journal of Information and Communication Technology, 16(2), 123-135 [in English].

14. [14] Global Reporting Initiative (2021). GRI Standards. Available at: https://www.globalreporting.org/standards/ (date of access: 12.03. 2025) [in English].

15. [15] Sustainability Accounting Standards Board (2023). SASB Standards. Available at: https://www.sasb.org/standards/ (date of access: 12.03.2025) [in English].

16. [16] Mamytov, A., Toktarov, A., Abdygalieva, S., Baiturbai, O. (2024). The use of remote sensing and GIS to ensuring digitalization agriculture of the Republic of Kazakhstan. Mine Surveying and Subsurface Use Journal, 1, 45-58 [in English].