Governance, Entrepreneurship, and the Path to Sustainable Development in BRICS Economies

As global concerns about climate change intensify, understanding the determinants of Green Total Factor Productivity (GTFP) in emerging economies has become essential. This study examines the drivers of Green Total Factor Productivity (GTFP) in BRICS countries (Brazil, Russia, India, China, South Africa) from 2000 to 2022, focusing on institutional quality, climate policy stringency, energy consumption, human capital, and sectoral growth. Using the Pooled Mean Group-Autoregressive Distributed Lag (PMG-ARDL) model, supported by panel causality tests and robustness checks, the study reveals a positive long-term relationship between GDP and GTFP (coefficient = 0.67), with bidirectional causality. Institutional quality (elasticity = 0.42) and human capital (elasticity = 0.25) significantly enhance GTFP, while climate policy stringency initially reduces GTFP (–0.60) but becomes neutral over time. Sectoral contributions show that industry (0.18) and services (0.13) have the most significant impacts on GTFP. The study contributed to an integrated approach combining macroeconomic, institutional, and environmental factors. Policy implications emphasize the need for stronger institutions and energy efficiency. Future research should explore broader geographic contexts and micro-level dynamics to strengthen GTFP models.

Purpose The purpose of this study is to investigate whether achieving comprehensive ESG disclosure enhances firm value in emerging markets and whether the valuation relevance of ESG disclosure depends on credibility mechanisms, including Global Reporting Initiative (GRI) compliance, disclosure maturity, regulatory strength, materiality, disclosure intensity and third-party assurance. Design/methodology/approach This study constructs a GRI-based ESG disclosure measure and applies a staggered difference-in-differences design centered on each firm’s first attainment of a comprehensive ESG disclosure threshold from 2011 to 2021 in BRICS economies. This study also analyzes the role of GRI alignment and maturity, regulatory strength, disclosure intensity, materiality processes and third-party assurance. Findings The findings of this study suggest that firms reaching a comprehensive ESG disclosure threshold exhibit higher firm value in the post-adoption period. The valuation relevance of ESG disclosure is not uniform and becomes stronger when disclosure is more credible and comparable, particularly when aligned with GRI standards (and more mature GRI iterations) and when supported by stricter sustainability regulations, explicit materiality processes and external assurance. Practical implications Managers should focus on credible, decision-useful ESG reporting with aligned disclosure, clear materiality and assurance, rather than expanding the narrative alone. Investors should distinguish between the extent of disclosure and its credibility, and regulators can enhance market usefulness by integrating disclosure requirements with a credibility infrastructure. Social implications This study highlights the importance of robust regulatory frameworks and comprehensive ESG disclosure, which fosters corporate transparency and accountability. These efforts can yield broader societal benefits, including improved environmental sustainability and enhanced social well-being. Originality/value This study contributes by replacing third-party ESG ratings with a transparent, GRI-based comprehensive disclosure index and combining it with a staggered difference-in-difference threshold-attainment design to connect disclosure improvements to firm value. This study also demonstrates that valuation gains rely on credibility mechanisms (GRI maturity, materiality, assurance and regulatory strength) in emerging markets.

Growth dynamics and sustainability of BRICS economies under climate uncertainty

This study investigates the associations between economic growth, healthcare expenditure, environmental pollution, urbanization, trade openness, and life expectancy in BRICS economies from 2000 to 2024 using a distribution-sensitive panel framework. Quantile regression is applied to capture heterogeneity across different levels of life expectancy, supported by robustness checks using PCSE, DKSE, and F-GLS estimators, and validated through panel cointegration and dependence tests. The results show that healthcare expenditure is positively associated with life expectancy, while the relationships for economic growth and pollution are mixed and vary with development stage. Urbanization exhibits both supportive and adverse associations depending on infrastructure capacity and environmental pressure, and trade openness generally relates to lower life expectancy. These findings suggest that policy responses should be tailored rather than uniform across countries. Strengthening the efficiency of healthcare systems, coordinating industrial growth with pollution management, and adopting environmental and health safeguards in trade and urban policy can help BRICS governments align economic expansion with sustainable improvements in population well-being.

The growing complexity of climate change within the global economy motivates researchers to explore its impact on various economic dimensions. In this quest, the present study explores the influence of climate risk index (CRI) and climate policy uncertainty (CPU) on the banking stability of the BRICS economies. In addition, the study also explores the moderating role of banking regulation and supervision on the aforementioned relationship. In order to accomplish the above objectives, the study employs a robust set of econometric models on the alternative proxies of banking stability, that is, Z-score and nonperforming loans (NPLs). Furthermore, to assess the impact of the Paris Agreement on the previously discussed relationship, the study analyses the above relationship across three distinct timeframes, that is, the complete sample (2007–2021), the period preceding the Paris Accord (2007–2014) and the timeframe following the Paris Accord (2015–2021). The findings from the panel-corrected standard error (PCSE) estimate indicate that CRI and CPU exert a negative impact on the banking stability by increasing the proportion of NPLs and reducing the Z-scores. In terms of the interaction variables, the study demonstrates that when CRI interacts with CPU, it exacerbates the negative influence on the banking sector’s stability. Moreover, considering the moderating variables, the empirical analysis indicates that banking regulation and supervision moderate the negative impact of CRI on the banking stability. The study also explains that the repercussions of the climate risk on the banking stability are more pronounced following the post-Paris Accord period compared to the period preceding the Paris Accord. The estimates remain consistent across various alternative methodologies, that is, the system-generalized method of moments and the fixed effects model. The study offers useful insight to comprehend the impact of climate risk on the banking stability.

The global financial system is undergoing a period of increasing fragmentation as payment and settlement infrastructures become politicised and alternative systems emerge. Platforms such as SWIFT and Euroclear remain central to cross-border finance, yet their use in sanction enforcement has encouraged the development of parallel payment and settlement arrangements, particularly among BRICS economies. This paper examines the implications of global payment system fragmentation for Cyprus, a small open economy and euro-area financial centre. Rather than focusing on direct exclusion or adoption of alternative systems, the analysis highlights indirect transmission channels, including confidence effects, compliance costs, capital flow volatility, and reputational risk. A conceptual framework is developed to explain how infrastructure fragmentation affects rule-taking economies, followed by a scenario analysis illustrating potential outcomes under different fragmentation trajectories. The results suggest that even under managed coexistence, fragmentation increases operational complexity and regulatory pressures for small financial centres. More severe fragmentation scenarios could amplify funding risks and challenge financial intermediation models. The paper concludes with policy recommendations for Cyprus and the European Union, emphasising regulatory alignment, compliance capacity, and infrastructure governance as key tools for managing fragmentation-related risks.

This study examines the determinants of renewable energy consumption among BRICS countries (Brazil, Russia, India, China, South Africa, Saudi Arabia, Egypt, the United Arab Emirates, Ethiopia, Iran, and Indonesia) between 2000 and 2022. Using static (Fixed and Random Effects) and dynamic (First-Difference GMM) panel data models, the research investigates how economic, institutional, and social factors influence renewable energy transition. The results reveal structural heterogeneity within the bloc. Among the founding members, renewable energy consumption is positively associated with governance quality and trade openness, while GDP per capita exhibits a negative relationship, consistent with the Environmental Kuznets Curve hypothesis. In contrast, the new members show strong energy dependence and limited institutional capacity, with dynamic models confirming high persistence in energy consumption and weak responsiveness to economic and policy changes. Variables such as education and life expectancy were omitted in the dynamic specification due to limited temporal variation, without compromising model consistency. Diagnostic tests (Hansen, Sargan, and AR(2)) confirm the robustness of the estimates. Overall, the findings highlight the importance of strengthening institutional governance, technological innovation, and intra-bloc cooperation to advance energy transition and achieve sustainable development across the BRICS economies.

This study examines the impact of financial development on economic growth in the BRICS countries, Brazil, Russia, India, China, and South Africa over the period 2000 to 2024. It aims to determine how financial development contributes to growth in these emerging economies, which play an increasingly influential role in the global financial system. Drawing on literature emphasising capital accumulation, innovation, and financial intermediation, the study focuses on gross fixed capital formation, employment-to-population ratio, research and development expenditure, and domestic credit to the private sector. Using a quantitative panel data approach with fixed and random effects regression models, the Hausman test identifies the fixed-effects specification as most suitable, accounting for country-specific institutional and structural characteristics. Results show that gross fixed capital formation and research and development expenditure significantly boost GDP growth, highlighting the importance of investment and innovation, whereas financial development exhibits an insignificant or negative effect, reflecting inefficiencies in credit allocation and weak transmission to productive investment. The study concludes that financial development alone is insufficient for growth; sustainable expansion requires effective regulation, good governance, inclusive financial systems, and deeper capital markets across BRICS economies.

ABSTRACT The reliance on natural resource rents is increasingly a factor that decisively influences the economic stability and sustainability of states, especially in the context of the expanded BRICS economies. The study investigates the drivers of resource dependence in these countries, focusing on FinTech, institutional quality, digitalization, and human capital. The current work analysis utilizes a balanced panel dataset from 1996 to 2023 and leverages the Method of Moments Quantile Regression (MMQR) to identify heterogeneous effects at different levels of natural resource dependence. Common Correlated Effects Mean Group (CCEMG) estimators and Augmented Mean Group (AMG) are used to test robustness, which shows that the results are consistent and in the right direction. The findings of the present study show that financial technology greatly alleviates resource dependence, particularly in countries with high natural resource intensity. Institutional quality also helps in decreasing dependence, though to a lesser extent, especially in non–resource‐dependent settings, whereas human capital exerts a negative but less robust impact. By contrast, digitalization is found to be positively related to resource rents, indicating that without green policy harmonization, in the short run at least, the expansion of digital technologies could prove to be more intense in terms of resource utilization. The paper's originality also consists in the interaction of distribution‐sensitive quantile regressions with second‐generation estimators under resource dependence conditions, providing new evidence on how structural technology components interact asymmetrically among BRICS+ economies.

Abstract This study examines the determinants of export sophistication across BRICS countries (Brazil, Russia, India, China, and South Africa) from 2000 to 2022. It focuses on the heterogeneous effects of macroeconomic variables economic growth (GDP), foreign direct investment (FDI), human capital, and research and development (R&D) as well as the impact of the COVID-19 pandemic on export sophistication. The study employs the cross-sectionally augmented autoregressive distributed lag (CS-ARDL) approach, which effectively captures cross-sectional dependence and slope heterogeneity, improving upon traditional panel estimation techniques. The empirical findings indicate that GDP growth, FDI inflows, human capital, and R&D expenditures positively influence export sophistication in BRICS economies, while the COVID-19 pandemic exerts a negative effect. These insights offer important policy implications for enhancing export quality and economic resilience in emerging markets.

ABSTRACT Climate change has evolved from an environmental concern into a strategic challenge, exposing firms to financial, operational, and reputational risks that threaten long‐term survival. Resilience to these risks, however, remains uneven, particularly in emerging economies where institutional diversity and regulatory gaps complicate adaptation. Although ESG strategies are increasingly promoted as tools for resilience, evidence of their effectiveness in heterogeneous contexts such as the BRICS economies remains limited. This study addresses this gap by examining how ESG strategies enhance corporate climate risk resilience (CRR) in BRICS, with a focus on the moderating role of sustainable governance and the mediating role of digital transformation. The analysis uses panel data from 641 listed manufacturing firms in BRICS economies between 2010 and 2023 and applies dynamic panel estimations, non‐linear modeling, and multi‐level analysis with robustness checks. The results show that ESG strategies significantly strengthen resilience, with environmental and social practices providing strong early gains but diminishing returns, while governance reforms generate slower yet compounding effects over time. Cross‐country analysis finds environmental strategies most influential in China, social initiatives strongest in South Africa, and governance reforms most effective in Russia, while industry‐level evidence highlights resilience gains in energy‐intensive and technology‐driven sectors. The study contributes by unpacking non‐linear ESG–resilience dynamics, clarifying the enabling roles of governance and digitalization, and extending ESG scholarship to underrepresented BRICS contexts. Policy recommendations emphasize tailoring ESG strategies to institutional and sectoral conditions, strengthening regulatory frameworks, and expanding digital and green finance infrastructure to accelerate sustainable and resilient business practices.

The impact of renewable energy on CO2 emissions in Middle Eastern and BRICS economies

ABSTRACT As global industries confront escalating environmental pressures, translating corporate sustainability ambitions into measurable circular outcomes has become increasingly essential. This study investigates how firm‐level sustainability targets (FST) drive the adoption of circular business strategies (CBS) among manufacturing firms in BRICS countries, where rapid industrialization intersects with institutional diversity and sustainability constraints. Grounded in the resource‐based view and strategic fit theory, the study proposes an integrated framework in which eco‐innovation mediates, and sustainable governance moderates, the FST–CBS relationship. Using a panel dataset of 789 listed manufacturing firms from 2010 to 2023, the study applies a dynamic panel generalized method of moments (GMM) estimation with additional instrumental variables to address potential endogeneity and enhance the robustness of the results. The findings reveal that FST significantly enhances circular adoption but follows a nonlinear pattern, indicating an optimal threshold beyond which excessive targets may strain resources and reduce strategic effectiveness. Eco‐innovation emerges as a key mechanism translating sustainability intent into operational circular practices, while strong governance further amplifies this effect. Heterogeneity analyses across industries, countries, and ownership structures reveal that the sustainability–circularity nexus is shaped by contextual and institutional factors. The study contributes novel empirical evidence on how strategic sustainability alignment and governance capabilities jointly determine the effectiveness of circular transformation. It offers actionable insights, urging firms to balance ambition with capacity and policymakers to strengthen ESG disclosure, incentivize innovation, and embed governance reforms that foster credible and scalable circular transitions within and beyond the BRICS economies.

This study examines the dynamic and distributional effects of financial technology (FinTech) and renewable energy (RE) on financial stability (FST) in BRICS economies from 2012 to 2022. Using a combination of Panel Autoregressive Distributed Lag (Panel ARDL) and Panel Quantile Regression (PQR) models, the analysis captures both short-run versus long-run adjustment mechanisms and heterogeneous effects across different levels of financial stability. The ARDL results reveal a dual effect of FinTech: while FinTech expansion initially increases short-run financial volatility, it enhances long-run stability as regulatory and institutional frameworks mature. Renewable energy consistently strengthens financial stability, with its impact intensifying in higher quantiles of the stability distribution. The quantile results further show that the stabilizing effects of FinTech, RE, institutional quality, and industrial development become stronger in more resilient financial systems. These findings highlight the need for BRICS policymakers to coordinate digital financial innovation with clean energy strategies under robust governance frameworks to promote a more stable, inclusive, and sustainable macro-financial environment.

Agriculture still employs large shares of the workforce in many BRICS and BRICS-aligned economies, yet output per worker remains uneven across countries. This paper examines the drivers of farm labor productivity in ten BRICS+ members, namely Brazil, Russia, India, China, South Africa, Egypt, Ethiopia, Indonesia, Iran, and the United Arab Emirates, using a balanced panel for 2001-2021. Drawing on data from the World Development Indicators, FAOSTAT, and UNDP, we estimate country fixed-effects models of agricultural value added per worker on lagged human development (HDI or schooling), arable land per worker, fertilizer use per hectare, national income (GNI per capita), and a time trend. The results show that higher HDI and greater land availability per agricultural worker are robustly associated with substantial productivity gains, whereas fertilizer intensity has no stable independent effect, and the influence of income largely operates through human development. A strong positive time trend suggests additional technological and institutional progress. Policy priorities should therefore combine investments in human development, land and tenure reforms, and innovation systems to foster inclusive productivity growth in BRICS+ agrifood systems.

This study empirically examines the role of renewable energy innovation in promoting green GDP growth while reducing carbon intensity within BRICS economies. Utilizing panel data econometrics and dynamic System GMM estimation over the period 2010–2022, the analysis integrates innovation indices, patent data, and R&D expenditures to capture technological progress. Results indicate that renewable energy innovation significantly enhances green economic growth, supported by complementary factors such as human capital, financial development, and foreign direct investment, while carbon emissions from energy use negatively impact growth. These findings underscore the critical importance of fostering innovation ecosystems, strengthening human capital, and improving institutional frameworks to accelerate sustainable development in emerging markets. Policy recommendations include targeted investments in clean technology R&D, financial incentives for green innovation, and regulatory reforms to attract quality FDI for sustainable energy transitions.

ABSTRACT Sustainability challenges in the BRICS economies require a multidimensional perspective that captures how environmental quality, human capital, and financial systems jointly shape long‐term development outcomes. This study examines these relationships using genuine savings (GS) as a comprehensive indicator of sustainability from 2000 to 2024. Drawing on clean cooking fuel access, PM 2.5 exposure, forest area, female labor participation, domestic credit, and health expenditure, the analysis applies the method of moments quantile regression (MMQR) to uncover heterogeneous effects across the sustainability distribution. The results show that forest area and female labor participation consistently improve GS, while PM 2.5 and health expenditure exert negative pressures, particularly in countries positioned at lower sustainability quantiles. Domestic credit has a modest but positive influence, and the effect of clean cooking fuels weakens at higher quantiles. Robustness checks using OLS, HAC‐robust, and cluster‐robust estimators confirm the stability of the findings. The study highlights the need for targeted, country‐specific strategies that strengthen natural capital, expand gender‐inclusive labor markets, reorient health spending toward preventive systems, and improve the allocation of financial resources. These insights offer practical guidance for accelerating sustainable development transitions in the BRICS region.

ABSTRACT This paper investigates the dynamic and asymmetric connectedness between major foreign exchange rates (RUP, RUB, REAL, YUAN, RAND) and BRICS stock market returns. An asymmetric Time-Varying Parameter Vector Autoregression (TVP-VAR) model is employed alongside bootstrap rolling-window Granger causality tests and a risk-based portfolio assessment. The findings reveal strong interconnectedness during normal market conditions, with the weakest linkages observed in negative-return regimes, suggesting potential diversification benefits. RAND and BOVESPA emerge as key transmitters of spillovers in normal and bear phases, whereas RUB becomes the dominant shock contributor during bull markets. Most market pairs exhibit bidirectional causality, except BOVESPA–REAL and SSE–YUAN. Geopolitical events such as COVID-19 and the Russia–Ukraine war amplify causal intensities. Portfolio results show RUB/RAND as the costliest pair, YUAN/REAL as the cheapest, and RUB/BSE as the strongest hedging combination with the highest Sharpe ratio.

This paper addresses a significant gap in the existing literature on financial inclusion — namely, the dynamic instability of the impacts generated by its determinants in four major emerging market economies: Brazil, Russia, India, and China. A time-varying coefficients framework is applied to examine whether the factors shaping financial inclusion at the aggregate level produce nonlinear effects over time. The analysis covers­ the period from 2000–2001 to 2022–2023. A composite financial inclusion index is constructed to capture inclusion across three key dimensions — availability, access, and usage — using the distance function approach. Three classes of determinants are modeled: socio-demographic, infrastructural, and macroeconomic variables. Evidence indicates structural instability in the financial inclusion process for the BRIC economies, with several determinants exerting nonlinear impacts over time. The findings challenge the conventional assumption of time-invariant relationships between financial inclusion and its dominant determinants. The results reveal considerable temporal volatility in the effects of macroeconomic factors, including growth and inflation, on financial inclusion across emerging markets. Policymakers should adjust strategies, moving beyond assumptions of linear processes and managing dynamic, nonlinear factors more effectively to achieve universal financial inclusion.