Towards sustainability: Examining financial, economic, and societal determinants of environmental degradation

We examine the determinants of environmental degradation, focusing on MENA economies from 1991 to 2020, with a particular focus on the role of sectoral composition. Specifically, we assess the contributions of the industrial, manufacturing, agricultural, and service sectors to GDP and their impact on environmental outcomes. Employing augmented mean group estimation, we evidence that technological advancements and renewable energy consumption significantly reduce environmental degradation, and that multinational corporations from developed countries transfer beneficial environmental practices to local firms in emerging regions. Results offer new insights into the impact of financial, economic, and societal factors on environmental outcomes. • The determinants of environmental degradation in the MENA region. • Technological advancements and renewable energy consumption significantly reduce environmental degradation. • Multinationals from developed countries can transfer advanced environmental practices to local firms in the MENA region.