Role of collaborative governance in unlocking private investment in sustainable projects

Abstract This scholarly investigation scrutinizes the involvement of the private sector in environmentally sustainable projects, employing the cross-sectional autoregressive distributed lag methodology on yearly data spanning from 2000 to 2020 across 11 low and lower-middle-income Asian nations. It specifically assesses the influence of the good governance index. Findings indicate a notable correlation, where a 1% enhancement in the index corresponds to a 0.34% increase in private engagement in green projects in the short term and a 0.64% increase in the long term. The study underscores the significance of economic stability; a 1% escalation in uncertainty leads to a 0.56% short term and 0.73% long-term reduction in private participation. It underscores the driving role of gross domestic product growth and the proliferation of small and medium-sized enterprises, emphasizing the necessity for tailored financial instruments to stimulate private investment in green projects. Moreover, it explores practical policy avenues such as e-government services, information and communication technology-driven digital transformation, sustainable corporate governance, and issuance of state-backed green bonds to foster private-sector participation in eco-friendly initiatives. Future research avenues encompass examining the repercussions of the pandemic on private green investments and evaluating the efficacy of the public-private partnership model in green projects across these economies.