ESG and the Green Economy in Emerging Markets: A Systematic Review of Mechanisms, Dynamics, and Drivers for SDG Acceleration
Background The urgency of climate action and the pursuit of sustainable development have positioned Environmental, Social, and Governance (ESG) criteria and green economy transitions as central policy instruments, particularly in emerging markets where economic growth must be reconciled with environmental stewardship. Despite growing scholarly attention, the mechanisms linking ESG implementation to Sustainable Development Goal (SDG) achievement remain fragmented and context-dependent. Methods Following PRISMA 2020 guidelines, a structured search was conducted on the Scopus database for peer-reviewed articles published between 2020 and 2026. Of 2,065 initial records, 756 advanced to title and abstract screening, 25 underwent full-text assessment, and 11 studies met all inclusion criteria for qualitative synthesis. Data were extracted using a standardised form, and risk of bias was assessed using a custom three-point scale. Results The synthesis reveals six principal mechanisms through which ESG implementation drives SDG acceleration: (1) green finance and renewable energy directly improve human development, life expectancy, and emissions reduction; (2) ESG disclosures and CSR practices enhance investment and environmental performance, mediated by green innovation and accounting; (3) mandatory regulations and audit mechanisms amplify voluntary ESG effectiveness; (4) short-term costs consistently precede long-term gains; (5) export diversification reduces ecological footprints; and (6) spatial spillovers are negative in archipelagic contexts, requiring deliberate policy coordination. Conclusions ESG and green economy initiatives are powerful drivers of SDG achievement when supported by strong institutions, patient capital, and spatially aware policies. For emerging markets, the path to sustainable development requires aligning financial, corporate, and governance mechanisms to ensure transition costs are outweighed by long-term resilience and equity gains.