The relationship between artificial intelligence and environmental performance: the mediating role of external environmental factors

Muhammad Khalid Anser, Muhammad Naeem, Shoukat Ali (), Sajid Ali and Rubab Javid
Additional contact information
Muhammad Khalid Anser: Xi’an International University
Muhammad Naeem: Islamia University of Bahawalpur
Shoukat Ali: Islamia University of Bahawalpur
Sajid Ali: Bahauddin Zakariya University
Rubab Javid: Islamia University of Bahawalpur

Palgrave Communications, 2025, vol. 12, issue 1, 1-7

Abstract: Abstract Despite the growing recognition of artificial intelligence in enhancing environmental performance, the pathways through which artificial intelligence influences environmental performance and the role of external factors, i.e., carbon emission strategies and sustainability regulations, in this relationship are unexplored. Data were collected from 387 employees of small and medium enterprises in Pakistan. Our empirical analysis confirms a positive relationship between artificial intelligence use and environmental performance. The results also reveal that external factors mediate and intensify the association between artificial intelligence and environmental performance. These findings are aligned with dynamic capability theory, which suggests that artificial intelligence tools with external factors can enhance small and medium enterprises’ capabilities to achieve sustainable development goals and improve environmental performance. This study has some practical and social implications for stakeholders, i.e., owners, policy-makers, and managers of small and medium enterprises in emerging economies, to promote sustainable practices and environmental performance of businesses. As per the researcher’s knowledge, this study is the inaugural investigation into the influence of artificial intelligence on environmental performance, considering the mediating role of external environmental factors and employing dynamic capability theory within the context of small and medium enterprises in Pakistan.

Date: 2025
References: Add references at CitEc
Citations:

Downloads: (external link)
http://link.springer.com/10.1057/s41599-025-05199-8 Abstract (text/html)
Access to full text is restricted to subscribers.

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:pal:palcom:v:12:y:2025:i:1:d:10.1057_s41599-025-05199-8

Ordering information: This journal article can be ordered from
https://www.nature.com/palcomms/about

DOI: 10.1057/s41599-025-05199-8

Access Statistics for this article

More articles in Palgrave Communications from Palgrave Macmillan
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().