<p>Achieving sustainable environmental outcomes remains a pressing challenge for large economies, where structural, policy, and demographic factors interact in complex ways. This paper examines the determinants of environmental performance in G20 economies from 2000 to 2024, using the environmental performance index, a multidimensional measure covering climate change, air quality, biodiversity, and waste. Explanatory variables include the economic complexity, environmental regulation, economic growth, foreign direct investment, renewable energy, and urbanization to account for macroeconomic and structural dynamics. A cross-sectionally augmented autoregressive distributed lag (CS-ARDL) model is employed. Results show that economic complexity, regulatory stringency, and renewable energy significantly improve environmental performance, while economic growth follows an Environmental Kuznets Curve (EKC) trajectory. Additionally, urbanization demonstrates a positive long-run effect on environmental performance. Empirical findings from the augmented mean group (AMG) and common correlated effects mean group (CCEMG) approaches further validate the robustness of the baseline results. The heterogeneous analysis reveals notable structural differences between advanced (G7) and emerging (E7) economies, with the magnitude and significance of the long- and short-run effects varying across the two groups. In particular, the positive impact of economic complexity and environmental regulation is more pronounced and consistent in G7 economies compared to E7 economies. The findings underscore the need for differentiated yet coordinated policy strategies within the G20 to enhance environmental outcomes and ensure alignment with global climate commitments.</p>