Driving environmental sustainability: exploring the role of energy transition, digitalization, globalization, and industrial structure in carbon emission efficiency

Climate change and environmental pollution are major threats to global ecosystems. Carbon emissions are the primary drivers of climate change worldwide, and reducing these emissions is the focus of every environmental policy aimed at decreasing environmental pollution and improving ecological sustainability. Therefore, this study aims to identify the drivers of environmental sustainability and motivations for decreasing carbon emissions to protect ecosystems. This study utilized super-efficient slack-based model and a panel-corrected standard error model to analyze the data of 170 countries from 2002 to 2021. The findings reveal the significant positive impact of digitalization (β = 0.0033) and energy transition (β = 0.0003), while industrial structure (β = −0.13) and globalization (β = −0.00065) have a strong negative impact on carbon emission efficiency (CEE). The gross domestic product (GDP) indicates a U-shaped relationship between economic growth and CEE, confirming the existence of the environmental Kuznets curve hypothesis. Therefore, the countries have a significant opportunity to improve their environmental quality and ecological sustainability by improving their CEE. Moreover, an increase in clean and renewable energy increases the chances of decreasing environmental carbon pollution through improved CEE. On the other hand, industrial structures decrease CEE, creating negative externalities for the global environment. High-emission industries should be compelled to achieve better environmental standards by implementing stringent environmental legislation.