Evolving Dynamics of Ecological Sustainability: Investigating ESG Investments and Governance Quality in G8 Nations

This study investigates the Environmental Kuznets Curve (EKC) and Load Capacity Curve (LCC) hypotheses from 1998 to 2022 in G8 countries, focusing on the moderating role of governance quality on ecological load capacity in the context of Environmental, Social, and Governance (ESG) investments, renewable energy consumption, technological innovation, and financial inclusion. Utilizing the load capacity factor as a novel ecological health measure provides a comprehensive understanding of the dynamics between technology, environmental sustainability, and governance quality. The EKC hypothesis posits an inverted U-shaped relationship between economic growth and environmental degradation, whereas the LCC hypothesis examines environmental impact shifts due to regulatory disparities. The study also explores the impacts of ESG investment, renewable energy, technological innovation, and financial inclusion on ecological load capacity, highlighting their importance for environmental sustainability. Employing MMQR, feasible generalized least squares (FGLS), generalized estimating equations (GEE), and fully modified ordinary least squares (FMOLS) methods, along with pairwise Granger causality tests, it provides a comprehensive understanding of the dynamics between technology, environmental sustainability, and governance quality. These findings are crucial for policymakers in formulating effective, sustainable development strategies.