Pandora’s Prosperity: Unraveling the Spellbinding Influence of Financial Renaissance, Renewable Innovations, and Trade Openness on Ecological Vistas

The increasing temperature and degradation of the environment have been identified as significant global concerns. Consequently, economies globally have endeavored to mitigate the temperature increase by up to 1.5 °C. Over the past 10 years, the United Nations has convened a conference (COP26) in Paris to advocate for the preservation of the environment. Hence, the present study examines the effects of financial globalization and the utilization of renewable energy sources on the ecological sustainability of the BRICS (Brazil, Russia, India, China, and South Africa) nations from 1990 to 2021. The analysis in this paper utilizes the Method of Moments Quantile Regression model. The findings indicate that financial globalization and using renewable energy mainly contribute to reducing emissions, particularly at higher emissions levels. The study reveals that various factors, namely, green energy, trade openness, mineral extraction, global value chain, and green tax, substantially impact the carbon footprint across different quantiles, including upper, middle, and lower quantiles. Urbanization has been found to positively impact carbon footprint at all quantile levels while using renewable energy sources has been seen to mitigate carbon footprint. Furthermore, the empirical findings indicate a statistically significant positive relationship between financial globalization and green growth in the economies of the BRICS nations. The implications of our research suggest that policymakers should prioritize the transition of energy and economic globalization to foster sustainable development in BRICS countries. This transition can catalyze the development of trade openness.