Toward the 2030 Agenda for Sustainable Development: Integrating ESG Strategies, Green Dynamic Capability, and Institutional Alignment for Cleaner Production Performance

ABSTRACT Accelerating cleaner production has become central to achieving sustainable development, particularly in emerging economies where industrial expansion must be balanced with environmental sustainability. Despite growing investments in ESG strategies, limited understanding exists of how firms translate these strategic commitments into cleaner production outcomes that support the 2030 Agenda for Sustainable Development. Drawing on Dynamic Capability Theory and Institutional Theory, this study examines how ESG strategies enhance cleaner production through the development of Green Dynamic Capability and the enabling role of institutional alignment. Using panel data from 475 manufacturing firms in Sub‐Saharan Africa over 2010–2025, the study applies the two‐step System Generalized Method of Moments estimator and conducts robustness checks using alternative measures and estimators. The findings reveal that environmental and governance strategies significantly improve cleaner production performance, whereas social strategies exhibit limited direct effects. Green Dynamic Capability partially mediates the relationship between ESG strategies and cleaner production, while institutional alignment strengthens the effectiveness of ESG strategies in achieving superior environmental outcomes. Robustness analyses using alternative measures, alternative estimators, and heterogeneity tests across regional and industrial contexts confirm the consistency of the findings. This study advances the sustainable development literature by demonstrating that cleaner production is accelerated not merely through ESG commitments, but through the strategic integration of organizational capabilities and supportive institutional environments. The findings offer important implications for managers and policymakers seeking to strengthen sustainable manufacturing and contribute to the 2030 Agenda for Sustainable Development, particularly in emerging economies.