Government-owned enterprises and sustainability: Review and research agenda

Government-owned enterprises (GOEs) can play a promising role in sustainability transitions because of their presence in energy-producing and energy-intensive sectors. However, empirical insights into the possible contributions and limitations of GOEs towards the many facets of sustainability transitions are scattered. This study is the first to provide a comprehensive review on the roles of GOEs in sustainability transitions, and to identify important knowledge gaps. We conduct a hybrid review on GOEs and sustainability transitions, and synthesize literatures from innovation studies, (business) economics, political science and governance/law. We first present an overview of the geographical and sectoral coverage of the literature and identify five different ways in which sustainability outcomes of GOEs are measured. We then discuss how firm-internal factors, government interaction, citizen engagement and scale, and competition influence sustainability outcomes of GOEs. The studied literature contains important lacunae, including the role of GOEs in long-term sustainability transformations, the influence of governance structures, and the relation to green industrial policy. We offer clear policy recommendations: government ownership will be able to positively contribute to sustainability transitions, but this is conditional on strong rule of law standards, sustained citizen engagement, and GOE-tailored regulation.