Engage or retreat? Exploring the determinants of participation in Climate Finance public-private partnerships

The urgent need for climate action and sustainable development has elevated the importance of Public-Private Partnerships (PPPs) in climate finance. While PPPs are crucial for mobilizing resources for climate finance, the factors influencing the willingness of different stakeholders to participate in these partnerships are not well understood. This study employs a multifaceted analytical approach, integrating theoretical insights from Stakeholder Theory, Transaction Cost Economics, and Agency Theory. We conduct a Tobit regression analysis to investigate the determinants of willingness to participate in climate finance PPPs among three key stakeholder groups: Governors, Firms, and the Public. Using survey data collected from over 1600 participants in Vietnam’s Mekong Delta, this research examines the influence of perceived benefits, perceptions of PPPs, the importance of climate finance, trust and transparency, and multilateral support on stakeholders’ willingness to participate in PPPs for climate finance. The analysis reveals that the perceived benefits of PPPs and trust and transparency universally enhance the willingness to participate across all groups of stakeholders. However, the impact of positive perceptions of PPPs varies, playing a crucial role for firms and the public but not for governors. The study also highlights the significance of understanding and emphasizing the importance of climate finance, particularly when combined with trust and transparency, in encouraging stakeholder participation. Furthermore, by revealing the varied impacts of determinants across stakeholder groups, this research points to the necessity of adopting differentiated approaches to maximize participation in PPPs for climate finance, thereby supporting sustainable development and climate action goals.