International cooperation and corporate strategies: accelerating corporate energy transitions in emerging economies

Driven by the growing focus on decarbonisation and energy economic dynamics in emerging economies, this study examines the interplay between executive compensation (EC), sustainability-based compensation (SBC), board sustainability committee initiative (BSCI), corporate energy transition initiatives (CETIs), corporate carbon emissions (CCEs) and firm performance (FP) using a multi-theoretical framework. Analysing a panel dataset from 13 emerging economies spanning 2002–2022, we find that SBC positively influences CETIs, while EC has no significant effect. Our results also show that EC and SBC do not impact CCE. BSCI positively affects CETIs but has no significant influence on CCE. Additionally, BSCI moderates the relationship between EC and CCE, highlighting the critical role of governance structures. While CETIs are associated with low FP, CCE appears to have no direct impact on FP. These findings vary across business operating periods and remain robust under alternative measures, addressing potential endogeneities and sample selection bias. The results provide insights for policy makers and practitioners aiming to enhance sustainability practices in emerging economies.