The Role of Carbon Accounting, Digital Transformation, Global Uncertainty, and Energy Efficiency in Improving Financial Decision-Making and Supporting Sustainability in High-Emission Industries

This study aimed to examine the integrated effects of Carbon Accounting (CA), Digital Transformation (DT), Energy Efficiency (EE), and Global Uncertainty (GU) on enhancing Financial Decision-Making Quality (FDMQ) and improving Sustainability Performance (SP) in high-emission industrial companies. Drawing on Dynamic Capabilities Theory, the study proposed that these practices represent interconnected organizational capabilities that enhance firms’ adaptive capacity and their ability to create sustainable value, while Global Uncertainty represents a contextual factor that may influence the effectiveness of these capabilities. The study adopted a quantitative longitudinal research design using Panel Data Analysis based on secondary data obtained from annual financial reports, sustainability reports, and corporate disclosures of industrial companies listed on the Palestine Exchange. The sample consisted of ten industrial companies observed over the period 2020–2025, resulting in 59 firm-year observations. The Fixed Effects Model was employed to examine the direct relationships among the study variables, complemented by mediation and moderation analyses to investigate the mediating role of Financial Decision-Making Quality and the moderating effect of Global Uncertainty. The empirical findings revealed that Carbon Accounting, Digital Transformation, and Energy Efficiency positively affect Financial Decision-Making Quality, indicating that firms with more advanced environmental accounting systems, stronger digital capabilities, and higher operational efficiency are better positioned to make effective financial decisions. Furthermore, these organizational capabilities were found to have direct positive effects on Sustainability Performance. In contrast, Global Uncertainty was found to negatively affect both Financial Decision-Making Quality and Sustainability Performance, while also weakening the positive effects of organizational capabilities on financial decision-making. The results further confirmed that Financial Decision-Making Quality plays a significant mediating role in the relationship between organizational capabilities and Sustainability Performance. Overall, the findings support the assumptions of Dynamic Capabilities Theory by demonstrating that achieving sustainability in high-emission industries requires the integration of environmental, digital, and financial capabilities within a coordinated organizational system rather than treating them as isolated practices.