ACHIEVING SUSTAINABLE GROWTH: INTEGRATING ENVIRONMENTAL SOCIAL AND GOVERNANCE FACTORS INTO THE COMPANY'S FINANCIAL STRATEGY

Abstract

The increasing economic and social development of societies is widely acknowledged to have resulted in a number of ecological problems. Thus, the purpose of this study is to analyze the impact of natural resources, social inequality, human development, and institutional quality on trade-adjusted material footprints in G10 countries from 1992-2022. The long-run and short-run relationships have been examined via the cross-sectionally augmented autoregressive distributed lags (CS-ARDL) model, which takes into account the importance of cross-sectional dependence, the absence of slope homogeneity, the stationarity characteristics, and the panel cointegration between the variables. Empirical findings point a positive long-and short-term environmental impacts (i.e., low material footprints) as a consequence of investments in human capital and high-quality institutions. Environmental sustainability is being threatened by increased material footprints brought about by increasing demands on finite natural resources, social inequity (economic inequality), and urbanization. The findings show that improved human development and high-quality institutions are necessary for efficient management of natural resources and for achieving ecological sustainability.