Green governance in public administration: a systematic review and bibliometric analysis of environmental policy implementation

Systemic failures of environmental governance hinder strategic green transformations. In highly concentrated sectors, companies have the incentive to prioritise immediate profit over long-term gains, giving rise to mere symbolic results as self-reported metrics which create space for greenwashing. Greenwashing is demonstrated by over-committing to move towards a more environmentally friendly approach without actually implementing meaningful change (Zhang et al., 2022a). Allowing firms to influence revealed signals and distort performance relative to true performance worsens this issue (Li et al., 2018; Zhang et al., 2022b). There are signs of governance failure, in public administration with minimal institutional capacity and enforcement. That translates into stricter verification of self-reported information, and more scrutiny to ensure environmental regulations are not just paper checks.

Not much tangible improvement occurs as high polluting enterprises are still on a good light, they use self-reported environmental indicators. Concisely, prior studies show that the most unsustainable firms are often manipulated via more serious greenwashing when subjected to regulation or media pressures (Zheng & Li, 2024). Thus exemplifying a long-standing institutional problem where programmes earn brownie points for written work as opposed to for the doing and thus veneer, over action. If regulation is lax, firms can exploit loopholes and keep polluting (Zhang & Wang, 2023). But self-reports can provide a false image of corporate behavior, which may come with an unwarranted enjoyment of trivial green activities whenever presented as serious business practices (Liu et al., 2022a).

Sectoral policies with a sector-specific approach are often prone to providing incentives for superficial compliance, as it is far cheaper to pay the penalty than to lose market share by losing its green shelter. According to the regulations of China, enterprises take the least action necessary and focus on public relations instead of real sustainability (Wang & Lv, 2025). This issue is particularly bad in areas like energy and heavy manufacturing since what policies are ultimately put into effect is dictated by corporate interests. Profits win every time over environmental goals, and alternative corporate studies (Wang & Xiao, 2025). Accordingly, carbon neutrality policies often fall short their objectives, as businesses comply with the bare minimum to avoid penalties while continuing to resist destroying change related to profitability (Hu et al., 2021).

The dissonance between the policy intent and how it gets implemented is particularly stark within the local space, where funding frequently collapses due to poor connections, enforcement mechanisms and accountability customs. Additionally, as indicated by studies already done national targets can lead to local government resource misallocation where it is most needed (Xu & Zhu, 2022). Sustainability goals are often restrained by economic imperatives in many industries, which exacerbates the green bottlenecks (Yao et al., 2023). Centralized systems, by their very design, set multiple parties in opposition to one another; this is particularly the case for industries reliant on polluting practices. Moreover, the governance architecture neither favors sustainability nor regards social and environmental voices highly (Fay et al., 2014).

Limited stakeholder participation leads to weak trust and management with an image problem, substantive commitment confused with symbolic compliance. By careful stakeholder engagement, green initiatives are not grounded only in a form of window dressing practices that would help improve corporate image (Cao et al., 2024). The monitoring, transparency and engagement of relevant stakeholders are needed to improve the accountability and make the implementation of environmental strategies real (Avlogiaris et al., 2023). If these mechanisms are strengthened, the risk of greenwashing will decrease and this will allow for real environmental transitions that lead to substantial change rather than just superficial efforts.

While trustworthy ESG frameworks remain essential for businesses to consider, some divergences in ratings exist due to the maturing of green governance acting as an emollient for organizations and financial institutions. Agencies use different approaches and varying levels of transparency, so there is no way to know what calculations are underlying. Inconsistencies of comparabilityorignate from the differing quality of disclosed information, which diminishes ESG metrics’ credibility. It follows that to solve, say, these problems, policymakers should encourage actions that help align disclosure systems and participate in strengthening the “quality, reliability and transparency” of ESG ratings. This will require strong administrative oversight to ensure transparency in ESG disclosures which are necessary for accountability to stakeholders, and not just symbolic works of reputation management (Shah et al., 2022).

In summary, systemic failures with regard to green transition continue to make for greenwashing and symbolic compliance especially in the profit driven sectors. Weak enforcement mechanisms and institutional constraints enable firms to exploit reporting pathways, and local authorities working under pressure to grow their economies often lead resource implementation to be both selective in practice and distorted. The challenges, coupled with continuing stakeholder tensions and bureaucratic inertia highlighted in this annual report, call for tighter scrutiny of environmental promises through transparent reporting and accountability, policy reforms that have an exclusive bias in favour of ecological stability.

Weak enforcement, inappropriately priced resources and policies that fail to develop appropriately often leaves environmental policies torn between economic development and protection. Regulatory effectiveness is hampered either by local capacity or an inadequate legal framework, leading to widespread non-compliance due to weak enforcement (Liu et al., 2022b). It is compounded by local governments giving primacy to economic growth, which gives firms a free pass from regulations (Kumar & Dwidvedi, 2023; Yao et al., 2023). Weak financial penalties and self-reporting foster greenwashing, firms behave responsibly on average without changing (Zhang et al., 2022b). This creates a disconnect and the consequence is symbolic compliance instead of real change (Hou et al., 2023). Strengthening administrative oversight is key to better enforcement and proper alignment of policy outcomes.

Fossil fuel subsidies, low pollution pricing and no broad-based carbon prices lead to under-pricing of environmental resources which is an important driver of unsustainable development (Du et al., 2023; Wei & Rafael, 2023). Such gaps create diverging economic incentives keeping environment destructive practices profitable over a period. A shortcoming of signalling is the weak accuracy of market prices that does not reflect the real pollution and depletion costs, which restricts green innovation (Peng et al., 2022). Thus, in the absence of internalised climate externalities, high-emission sectors continue to be favoured by the market (Cao et al., 2024; Omrow et al., 2024). This type of behaviour undermines environmental governance and the quality of policy. A proper pricing mechanism for the total price on the environment, which can help stimulate green investment, should be greatly provided by policymakers (Dressler et al., 2021; Yao et al., 2023).

A fortiori, the lack of contextualized policy transplantation undermines environmental governance due to its further transfer presence, without tailoring it to specific local contexts. In particular, it is concerning for developing nations that are based on adopting frameworks from advanced economies without taking account the economic, social and environmental conditions (Kumar & Dwidvedi, 2023; Liu et al., 2022a). The imposition of global South (GS) focused regimes of sustainability is predominantly blind-based or abstract, it disregards local industry’s comparative economic needs, conditions and capability for development. This ultimately leads to ineffective regulatory outcomes in terms of delivering genuine structural change (Liu & Xia, 2023). Because such regulations are not designed for specific localities, it lessens the credibility and acceptability of these mandates among the indigenous stakeholders contributing more towards an ineffective regime of governance (Kumar & Dwidvedi, 2023; Mohy-ud-Din et al., 2025).

While environmental governance is not without flaws, it does convey an understanding of the need for context-sensitive and participatory approaches. Studies show local knowledge is more effective with community-based models and participatory policy design (Cooper et al., 2020). Yet, lessons from different countries indicate that compliance and reduced pollution more often flow from the context-specific designs that smart regulations facilitate than from matching one-size-fits-all regulatory prescriptions (Hoang et al., 2024). This is also the reason why a model that works for one set of customers may not be applicable on others, making adaptable systems an imperative. Decentralized governance is therefore vital so that local level actors can formulate strategies agreeable to their environmental and socio-economic contexts along with the larger national goals (Wei & Rafael, 2023).

In summary, the failures of environmental policy stem from ineffective enforcement, poor pricing and misaligned policy transfer, which stifle between sustainability and economic growth. A lack of institutional capacity for enforcement leads to over-compliance and greenwashing, while a weak price signal does not incentivize environmental costs effectively enough nor foster green innovation. Additionally, local factors are not taken into consideration and context-blind policies suffer from adding powerlessness to their narrative. Community-based approaches show potential but delivering these challenges requires comprehensive solutions that reflect strong regulation along with appropriate pricing bundled with context-specific policies plus improved institutional capability, independence and accountability.

Green development strategies, catalyzed there by the charge of carbon reduction, identify persistent systemic failures, announcement effects, bad implementation, and weak carbon pricing. These declarations tend to be abandoned quickly with little or no change (Liu & Xia, 2023). But despite ambitious targets set by many countries in relation to green financing initiatives, actual quarterly implementation presents a much narrower scope (Yao et al., 2023). This rhetoric-reality gap, in which short-term reputational rewards trounce long-term environmental targets, is already visible with China (Hou et al., 2023). One clear difference is that in some places in China emission targets were not matched by equally sized emission reductions as local governments favour growth (Xu & Zhu, 2022; Zhang et al., 2022b). Institutional capacity and enforcement have failed to convert symbolic public commitments into tangible outcomes from a public administration viewpoint, which explains the feasibility failure.

Weak enforcement capacity, characterized by limited and discretionary compliance, compounds the failure of environmental governance is compounded because most agencies face no cost pressures or lack autonomy to ensure compliance. In some cases, such strict rules imply more oversight and regulation of select loopholes (Wang et al., 2024b). So few companies can actually carry out off-putting practices due to meager enforcement. The profit vis-à-visprotection ratio beats up faster globally on account of regulatory capture in developing economies. This invariably implied poor institutional capacity and political patronage frequently prevented law from being enforced, giving way to corporate impunity (Cooper et al., 2020; Fay et al., 2014). For economic benefits, local governments may neglect violations and maintain the status quo of environmental pollution (Li et al., 2025; Tang & Du, 2024). In effect, lax compliance discourages transformation and implementation of cleaner technologies hindering emissions reductions whilst perpetuating unsustainable behaviours (Dressler et al., 2021; Peng et al., 2022).

Policy effects are further hindered by low enforcement capacity, where a small amount of resources or political will can significantly reduce any effective oversight. Together with the typical desire for growth, overlapping regulatory power to exact carbon regulation in China renders this elusive (Wei & Rafael, 2023). Carbon pricing is not enough to internalize emissions externalities thus continue favoring environmentally unfriendly behavior (Mohy-ud-Din et al., 2025; Tang & Du, 2024). No one is more responsible than they are with the only weak feature being voluntary markets or inferior pricing schemes, all of which reduce accountability. As a result, companies are under limited pressure to lower emissions and this cycle of environmental destruction continues (Hou et al., 2023; Li, 2023).

Research has revealed that market-based mechanisms are often insufficient for driving low-carbon investment, as the costs imposed on firms are deemed negligible relative to their overall profits, and many immediate priorities run contrary to current emissions targets. (Mortensen et al., 2024). This characteristic of weak pricing structure restrains transitions to low-carbon economy, and continues environmental externalities (Deng et al., 2024; Drożdż et al., 2021). This is with strong fiscal and carbon pricing policies as recommended by scholars to reflect prices correctly to induce green innovation (Cooper et al., 2020; Yao et al., 2023). On top of that, it is said that poorly contextualized policy transfer reinforces these problems including framework misalignment and ignores local realities or situations consequently paying less attention or wasting resources (Tao & Zhou, 2022).

In summary, addressing these pitfalls will require far more than simply revising regulations, as gaps and silos multiply organising opportune enforcement entailed changes to carbon pricing and context-sensitive policies. These problems epitomize the larger governance failures in which constrained institutional capabilities coupled with the prevailing “green governance context” limit oversight. Improvements in enforcement include the public investment required to give agencies that monitor compliance the means to impose penalties. Ensure a broad carbon pricing mechanism to internalise environmental costs and incentivise cleaner technologies. Policy responses can be context-specific, reducing the transferability of ill-suited policy solutions and increasing local relevance. Policymakers would also benefit from more effective verification of self-reported data and strict enforcement to reduce symbolic compliance. This means plugging implementation gaps strengthens institutions because action creates better environmental performance, not the other way round.

Customer-driven green innovation failures accentuate how self-reported indicators and the gap between ESG disclosures and actual performance provide fertile ground for greenwashing. The problem is, that firms can use flexible data to overstress sustainability claims, distract attention from the core innovation and loss citizen trust (Zhang et al., 2022b; Zheng & Li, 2024). Because the incentives for substantial emission reductions are diminished when these approaches have a limited influence (Zhang et al., 2022b). This reinforces the behavior found in all kinds of pollution-driven industries. This reinforces the reporting-claim gap while reflecting governance failure, as a result of low institutional readiness and weak enforcement (Yang et al., 2023).

Independent monitoring and enforcement mechanisms are integral to credible ESG reporting because these conditions require strong governance. Absent these, self-reported metrics work more like public relations tools than environmental proxies (Deng et al., 2024; Moussa et al., 2024). This leads to deceptive perceptions by consumers and investors, eroding the accountability (Jones & Wong, 2016). Without adequate enforcement, disclosure requirements are mostly mere symbolic compliance, rather than effective change (Hu et al., 2023). As a result, stakeholders might treat the scale of disclosure as an indication of true performance, ignoring symbolic aspects of reporting (Zheng & Li, 2024), and allowing firms to continue their underperformance despite likely detrimental effects on wider sustainability goals (Wang et al., 2024a).

The gap between ESG disclosure and actual environmental performance remains large chiefly due to weak enforcement and regulatory arbitrage. In many cases, however, firms are able to build sustainability stories based on little or no empirical footprints; for that reason, they have low material costs, which in turn means lower incentives to achieve real novelty and also appropriately use water control (Wei & Rafael, 2023) Rather than performance, a few companies focus upon reporting (Liu & Xia, 2023; Wang et al., 2024a), and even supply these fictions as evidence of progress that undermine the trust of stakeholders (Sun & Liu, 2022). The lax regulatory oversight of disclosure habits breeds data distortion (Zheng & Li, 2024), and contradictory enforcement exacerbates the divide between rhetoric and reality (Cao et al., 2024).

Transparency in effective governance can help to reduce greenwashing; specifically, the involvement of firms’ and industry’s external stakeholders in ESG monitoring leads to sustainability these days (Xu & Qin, 2024). However, if firms are from oversight through non-specific reporting standards or inadequate regulations underlie such pressures, those agencies tend to be extremely minimal (Omrow et al., 2024; Thomas & Suresh, 2024). The unquestioning acceptance of self-assessed ESG metrics with little to no scrutiny further exacerbates greenwashing and thwarts green innovation. Although empirical research suggests that ESG policies may reflect a commitment to regulated behavior, much compliance with environmental regulations will be ignored as enforcement remains weak (Hrckova, 2023). Xu and Zhu further argued that a lack of regulation diminishes the incentive for authentic green innovation, which perpetuates pseudo-green behaviour (Xu & Zhu, 2022).

Strong enforcement of government environmental policies, such as environmental protection tax policy, may support green innovation (Cao et al., 2024). Cao et al. provide support and mediation for green innovation, but only when the implementation capacities are robust enough (Cao et al., 2024). However, greenwashing can develop when weak accountability of the government leads to compliance without actual operational shift from companies (Deng et al., 2024; Zheng & Li, 2024). This spreadsheet lists the publication outcomes in strong enforcement mechanisms, an increase in third-party evaluations improves ESG accountability, and marketing levers to commercialize green innovations (Ning et al., 2023). The intractability of these problems exposes the gravitational pull of the deep structural flaws inherent to all systems of green governance in practice today. Dealt with by much more enforcement nudging, finer touchables on this front, and vigorous ESG disclosures accompanied by independent oversight to take robust rebuttal and stave off greenwashing.

In summary, self-report infrastructure that enables greenwashing and fragile ESG disclosure frameworks results in the failure of customer-led green innovation and performance scoring. But all of these challenges expose governance failures, the weak capacity of institutions straining public organisations’ ability to challenge corporate claims. A focus on the froth of firm-level symbolic compliance, and weak enforcement coupled with a lack of independent monitoring widens the chasm between rhetoric and reality, as high-pollution firms seek to save money by engaging in little if any real ecological transformation. With legal liability at its weakest, this in turn emboldens firms to escape accountability, which is guaranteed by the state. Overcoming these hurdles will entail stricter regulations, independent verification, and the right incentive structures together with mandatory verified reporting and an enhanced regulatory capability to make green governance a catalyst for real innovation rather than reputation washing.

Green governance remains troublesome to connect corporate strategy and the effectiveness of green finance, especially in poor institutional quality and a regulatory framework. A little transparency and accountability may lower the motivations for green financial instruments like loans, bonds, and investment vehicles (Liu & Xia, 2023), while it is believed that sound green governance must work on a robust institutional context to guarantee real sustainability (Wang et al., 2024a). The existing accountability systems are expected to prevent green finance from being diverted away so that it can be ultimately used to support non-sustainable projects in weak governance settings (Tang & Du, 2024). Thus, institutional quality as well as regulatory paternalism will need strengthening in order to hold public and private actors accountable for their actions and enhance real ecological change (Qi et al., 2020).

Green finance is tightly linked with institutional capacity to be effective. In the same context, weak institutions will represent cumbersome outcomes of governance and exert marginal environmental impact whereas strong institutional frameworks persuade sustainable investment (Liu & Xia, 2023). In this regard, since green financial products in some instances do not deliver genuine benefits and instead facilitate green washing (Mohy-ud-Din et al., 2025; Zhang et al., 2022b). In addition, poor institutional supervision provides a chance for firms to take advantage of loopholes in the regulations (Liu & Xia, 2023), which may continue reducing environmental standards and trust in green finance systems (Tang & Du, 2024).

Moreover, improper pricing of environmental externalities, carbon, and biodiversity loss dilutes the incentive to sustainable practices. In the absence of full internalization of these costs, firms are able to transfer environmental burden on society and keep optimizing short-term profits (Deng et al., 2024; Loia et al., 2022). Sustainable business models are reserved for a few privileged sectors and market systems, which disregard externalities (Mohy-ud-Din et al., 2025). Absent good pricing, incentives the world will have on its economic parameters remain misaligned with ecological objectives low-carbon transitions weaken as do accountability (Shah et al., 2022). If there is weak pricing of externalities, firms are likely to reinforce the status quo rather than spur green innovation.

In addition, the absence of externality pricing reflects in decision-making, allowing firms to pursue ostensible sustainability while executing damaging operations, causing greenwashing and preventing effective innovation based on reasonable environmental accounting (Moussa et al., 2024). It is therefore important to deal with the weaknesses in green finance governance. The quality of institutional improvement can regulate and enforce environmental standards, thus promoting the development of green finance tools (Mao et al., 2024). The impact of serious externality pricing mechanisms implemented in financial systems can also affect how corporations form strategies around sustainability. These developments require a shift away from compliance towards real corporate environmental accountability (Wang & Xiao, 2025). Yet, continuing institutional and price gaps are blocking effectiveness requiring systemic reforms to bolster accountability and internalise real environmental costs.

In summary, the ability of corporate strategies to promote economic resilience and sustainable investment in green governance is limited to weak institutional quality and a lack of focus on pricing environmental externality. These challenges epitomise the “governance failure” through which public administration does not have the capacity to monitor and enforce green financial instruments, creating a disjunction between policy intention and practice. More importantly, it requires more robust institutional frameworks and significantly more effective pricing mechanisms for externalities that can internalize these social costs in order to facilitate real sustainability. Policymakers need to tighten up due diligence legislation and other legal mechanisms so as to ensure that green investments are not surface level, while public administration needs to get serious about supervision, making sure sustainable finance is effectively embedded in corporate governance.