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The development of green economy is of academic and policy importance to governments and policymakers worldwide. In the light of the necessity of renewable energy to sustain green economic growth, this study aims to examine the relationship between renewable energy consumption and green economic growth, controlling for the impact of trade openness for Organization for Economic Co-operation and Development countries over the period 1990-2015, within a multivariate panel data framework.

To investigate the long-run relationship between variables, panel cointegration tests are performed. Panel Granger causality based on vector error correction models is adopted to understand the short- and long-run dynamics of the data. Furthermore, ordinary least square (OLS), dynamic OLS and fully modified OLS methods are used to confirm the long-run elasticity of green growth for renewable energy consumption and trade openness. Moreover, system generalized method of moment is applied to eliminate serial correlation, heteroscedasticity and endogeneity problems. The authors used the panel Granger causality test developed by Dumitrescu and Hurlin (2012) to infer the directionality of the causal relationship, allowing for both the cross-sectional dependence and heterogeneity.

The results suggest that renewable energy consumption and trade openness exert positive effects on green economic growth. The results of long-run estimates of green economic growth reveal that the long-run elasticity of green economic growth for trade openness is much greater than for renewable energy consumption. The estimated results of the Dumitrescu and Hurlin (2012) test reveal bidirectional causality between green economic growth and renewable energy consumption, providing support for the feedback hypothesis.

This paper provides strong evidence of the contribution of renewable energy consumption on green economy for a wide range of countries. Despite the costs of establishing renewable energy facilities, it is evident that these facilities contribute to the green growth of an economy. Governments and public authorities should promote the consumption of renewable energy and should have a support policy to promote an active renewable energy market. Furthermore, the regulators must constitute an efficient regulatory framework to favor the renewable energy consumption.

Many countries focus on increasing their GDP without taking the environmental impacts of the growth process into account. This paper shows that renewable energy consumption points to the fact that countries can still increase their economic growth with minimal damage to environment. Despite the costs of adopting renewable energy technologies, there is still room for economic growth.

This paper provides evidence on the contribution of renewable energy consumption on green economic growth for a wide range of countries. The paper focuses on the impact of renewable energy on economic growth by taking environmental degradation into consideration on a wide scale of countries.

The purpose of this study is to examine the dynamic connectedness and volatility spillovers between commodities and corporations exhibiting the best environmental, social and governance (ESG) practices. In addition, the authors determine the optimal hedge ratios and portfolio weights for ESG and commodity investors and portfolio managers.

This study uses the novel frequency connectedness framework to point out volatility spillover between ESG indices covering the USA, developed and emerging markets and commodity indices, including energy (crude oil, natural gas and heating oil), industrial metals (aluminum, copper, zinc, nickel and lead) and precious metals (gold and silver) by using daily data between January 3, 2011 and May 26, 2021, covering significant socio-economic developments and the COVID-19 outbreak.

The results of this study suggest a total connectedness index at a mediocre level, mainly driven by the shocks creating uncertainty in the short term. And the results indicate that all ESG indices are net volatility transmitters, and all commodity indices other than crude oil and copper are net volatility receivers.

The results imply statistically significant hedging and portfolio diversification opportunities to investors and portfolio managers across the asset classes, proven by the hedging effectiveness analyses.

This study provides implications for policymakers focusing on the risk of contagion among the commodity and ESG markets during turbulent periods to ensure international financial stability.

This study contributes to the existing literature by differentiating ESG portfolios as the USA, developed and developing markets and examining dynamic connectedness and volatility spillovers between ESG portfolios and commodities with a different technique. This study also contributes by considering COVID-19 outbreak.