The Impact of Economic Growth on Sustainable Development: an Analysis of ESG Indicators

Abstract

This study aims to evaluate economic growth's impact on key sustainability components, including carbon productivity, ecological conditions, healthcare, social well-being, and education. This paper employs Principal Component Analysis (PCA) to group complex ESG indicators into five distinct categories, followed by quadratic regression modeling to capture nonlinear relationships between GDP growth and each ESG component. The study uses statistical data collected from national and international sources for the period 2012-2022. The analysis showed that the impact of economic growth on ESG indicators in Kazakhstan is expressed heterogeneously. Economic growth showed the greatest correlation with education indicators (R2 = 0.696, p<0.01), indicating a significant improvement in the educational sector as GDP per capita increases. At the same time, the impact on environmental indicators turned out to be weaker (R2 = 0.352, p = 0.176), which indicates minor improvements in the environment that require additional environmental initiatives. Economic growth had the least impact on carbon productivity, with R2 = 0.13 (p = 0.58), which underlines the need for targeted measures to improve carbon efficiency. The results highlight that although economic growth contributes to social and educational development, specific ESG-oriented strategies are required to achieve sustainable development in Kazakhstan, especially in the field of carbon efficiency. Therefore, Future research may be aimed at localizing ESG metrics, evaluating the effectiveness of programs in the socio-environmental field, and creating multifactorial models for ESG analysis.