Unveiling the environmental efficiency puzzle: Insights from global green innovations

Is more not always better? Untangling the impact of ESG disclosure transparency on idiosyncratic risk

Environmental, social and governance (ESG) increasingly impacts firms' risk management and investment decisions. Based on instrumental stakeholder theory, this study uses data from Chinese-listed manufacturing firms from 2013 to 2021 to examine the relationship between ESG disclosure transparency and idiosyncratic risk (IR). Artificial intelligence (AI) intellectual property protection and institutional investor distraction are incorporated as moderating variables in examining this relationship. Our empirical results indicate that ESG disclosure transparency lowers IR initially. However, once a certain threshold is reached, ESG disclosure transparency commences to increase IR, showing a U-shaped relationship. Furthermore, this study verifies that AI intellectual property protection shifts the turning point of the U-shaped curve to the right and steepens the U-shaped link by strengthening the positive impact of ESG disclosure transparency. AI intellectual property protection thus has a complementary role to ESG disclosure transparency about the effect on IR. In contrast, institutional investor distraction shifts the U-shaped curve to the left. It flattens the U-shaped curve by weakening the positive effect of ESG disclosure transparency, demonstrating that institutional investor distraction takes on a substitution role to ESG disclosure transparency regarding its effect on IR. Managerial implications and future research avenues are also discussed.

From petrodollars to green power: Fiscal stability and green transition in GCC economies

This study examines the influence of fiscal stability, characterized by fiscal buffers, on the green transition in the Gulf Cooperation Council (GCC) economies from 2005 to 2023. We apply two-way fixed effects, system generalized method of moments (GMM), method of moments quantile regression (MMQR), and panel causality analysis to explore these dynamics. Our findings underscore that a positive fiscal buffer resulting from a significant spread between oil prices and fiscal breakeven levels exerts a substantial positive impact on green transition efforts in GCC countries. The results reveal that countries with higher levels of renewable energy production capacity and urbanization demonstrate more pronounced advancements in green transition initiatives. Conversely, countries grappling with unstable macroeconomic conditions, such as high inflation and external debt, face considerable challenges in achieving significant improvements in green transition outcomes. Additionally, our analysis shows that fossil fuel energy fiscal subsidies negatively influence green transition efforts in the GCC region. Our study emphasizes that policymakers in GCC countries should pursue a dual-pronged strategy: leveraging positive fiscal buffers to diversify their economies in light of potential benefits from high oil prices, and channelling oil and fiscal revenues towards enhancing renewable energy production capacities. This approach aims not only to diversify economic foundations but also to strategically strengthen the infrastructure necessary for sustainable renewable energy transitions in the region over the long term.

Resilient green infrastructure: Navigating environmental resistance for sustainable development, social mobility in climate change policy

This study explores the complex dynamics of environmental resistance, policy stability, skill development, and green initiatives in light of the growing worldwide concerns about climate change. COP27 and the G20 Summit show that as microcosm of the global discourse, provides a unique opportunity to study it. This research sought to thoroughly investigate, the links among green infrastructure, green technological innovation, policy stability, skill development, and their combined effects on social mobility and climate change (Case-1), it also discusses the global talk on climate change in COP27 and G20 (Case-2). In Case-1 data were analyzed through the use of structural equation modeling (SEM) by adopting a quantitative approach, and in Case-2 data were analyzed using theme analysis by applying a qualitative approach. Using a mixed-method research approach, the study surveyed 375 locals living close to the CPEC corridor quantitatively and interviewed ten important stakeholders, including elected officials, environmental activists, and community leaders, qualitatively. The survey highlighted the complex perspectives and experiences of citizens with green programs and environmental legislation in the CPEC zone. The study revealed the perceptions and experiences of residents regarding green initiatives and environmental policies within the CPEC region. Key stakeholders provided valuable insights into policy formulation and ongoing environmental sustainability efforts. The analysis unveiled intricate relationships between green infrastructure, technological innovation, policy stability, skill development, and their collective impact on climate change and social mobility. Notably, the study identified a critical research gap in understanding these dynamics within regions undergoing substantial economic development. Policy formulation and continuing environmental sustainability efforts were aided by key stakeholders' ideas. Green infrastructure, technological innovation, policy stability, skill development, and their overall influence on climate change and social mobility were all examined. Notably, the study found a critical research vacuum in understanding these processes inside rapidly developing economies. Policymakers, environmental groups, and communities managing the fine line between economic success and environmental responsibility will find great value in the findings. This study is unique because it examines issues on climate change from a local perspective in a region that is rapidly developing economically, it also adds value to the climate change challenges on the global level. This study presents a substantial theoretical contribution by examining the intricate interactions among environmental opposition, policy stability, skill development, and green initiatives within the CPEC against the backdrop of global climate change concerns.

ESG practices mitigating geopolitical risks: Implications for sustainable environmental management

As climate change and geopolitical conflicts intensify, understanding how geopolitical risks affect companies prioritizing Environmental, Social, and Governance (ESG) practices is crucial. This study investigates the dynamic relationship between global geopolitical risks and the performance of Environmental, Social, and Governance (ESG) and non-ESG companies, particularly their influence on green markets. Utilizing a robust methodological framework, including the dynamic time-varying parameters vector autoregression (TVP-VAR) model, and causal impact modeling, we analyze daily financial data from 2021 to 2024. The results reveal a substantial negative impact of geopolitical risks on non-ESG companies, contrasting with the resilience of ESG-committed counterparts. This suggests that ESG-committed companies demonstrate better resilience against geopolitical risks, emphasizing the protective role of ESG practices amid uncertainties. Additionally, the inclusion of ESG companies in green markets diminishes the severity of the negative impact of geopolitical risks, underlining the transformative role of ESG commitment in shaping investor behavior towards sustainable investments. Our findings offer insights for policymakers and investors navigating geopolitical risks and ESG performance, with a focus on environmental management, and provide guidance for effective risk mitigation and investment policies to enhance environmental sustainability.

Environmental regulation, land use efficiency and industrial structure upgrading: Test analysis based on spatial durbin model and threshold effect

Environmental regulation promotes industrial structure change and regional economic transformation through land use adjustment, which gets a new way to explore the path of reforming traditional industrialization and urbanization. Based on the panel data of 128 prefecture-level cities in China 's Yangtze River Economic Belt from 2000 to 2020, this paper uses the spatial Dubin model to analyze the impact of environmental regulation and land use efficiency on the upgrading of industrial structure, and sets the panel threshold model to examine the impact of environmental regulation on the upgrading of industrial structure by affecting land use efficiency. The results show that formal environmental regulation has a significant positive spatial effect on the rationalization and upgrading of industrial structure, which are 0.1734 and 0.2854 respectively. Informal environmental regulation has a negative spillover effect on neighboring provinces but not significant. Heterogeneous environmental regulation has obvious "double threshold effect" on industrial upgrading by affecting land use efficiency. When the threshold of environmental regulation intensity is 0.0315-0.0886, environmental regulation still inhibits land use efficiency and industrial structure upgrading. When the threshold value is greater than 0.0886, environmental regulation has a positive impact on land use efficiency but not significant. With the intensity of environmental regulation from weak to strong, it will produce a double threshold effect of "strong inhibition-weak inhibition-interaction promotion" on the upgrading of manufacturing structure through the adjustment of land use efficiency.