<p>Effective wastewater management in agriculture is critical for protecting water resources, ensuring food security, and maintaining ecosystem health. However, many countries face persistent challenges in meeting wastewater policy goals due to institutional, regulatory, and technological limitations. This study aims to examine how different governance and infrastructure contexts shape the implementation of agricultural wastewater management strategies. Using the New Institutional Economics (NIE) framework and a comparative case study approach, we analyze Japan and South Africa—two countries that experience significant agricultural wastewater challenges but differ substantially in water availability, agrochemical use, infrastructure capacity, and socio-economic development. These differences provide a valuable basis for exploring context-sensitive governance responses across diverse settings. Our findings show that Japan’s structured coordination and sustained investment in technology support large-scale, sustainable wastewater management. In contrast, South Africa’s infrastructure constraints and resource disparities have encouraged low-cost, community-driven innovations that demonstrate adaptability under resource-scarce conditions. The study concludes that strengthening multi-stakeholder collaboration, clarifying institutional roles, and tailoring governance mechanisms to local capacities are critical for improving wastewater policy outcomes. Cross-country learning offers further promise: South Africa’s grassroots innovations illustrate the potential of decentralized, low-cost approaches, while Japan’s institutional coherence provides transferable insights for systemic reform. Together, the findings make the case that collaborative and decentralized governance—anchored in local realities and informed by mutual learning across contexts—offers a cost-effective pathway to sustainable agricultural wastewater management.</p>