Can Industry 4.0-enabled smart manufacturing help firms in emerging economies move toward carbon-neutrality?

The manufacturing industry plays a pivotal role in the economic growth of all countries. Most manufacturing firms consume large amounts of energy and fail to adopt sustainable practices. However, Industry 4.0 is expected to help firms move toward carbon neutrality. Hence, this study focuses on 10 manufacturing firms in India and the opinions of industry experts to analyze the factors that motivate organizations to implement carbon neutrality. First, the driving factors of the shift toward carbon neutrality were investigated and ranked using the fuzzy analytic hierarchy process. Fuzzy interpretive structural modeling was then used to explain the interrelationships among the identified factors, providing a seven-level hierarchy model with 14 factors. Focusing on "Sustainable Business Value", "Environmental Legitimacy" and "Government Policies" can help managers to develop strategies that are both socially responsible and profitable. These key findings have significant strategic implications for industry and policymakers.