The Effect of Green Banking Practices on Banks’ Environmental Performance and Green Financing: An Empirical Study

Jing Chen, Abu Bakkar Siddik, Guang-Wen Zheng, Mohammad Masukujjaman and Sodikov Bekhzod
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Jing Chen: School of Economics and Finance, Xi’an Jiaotong University, Xi’an 710061, China
Guang-Wen Zheng: School of Economics and Management, Shaanxi University of Science and Technology (SUST), Weiyang District, Xi’an 710021, China
Mohammad Masukujjaman: Department of Business Administration, Northern University Bangladesh, Banani C/A, Dhaka 1213, Bangladesh
Sodikov Bekhzod: School of Economics and Management, Shaanxi University of Science and Technology (SUST), Weiyang District, Xi’an 710021, China

Energies, 2022, vol. 15, issue 4, 1-22

Abstract: Every sector of the global economy is faced with environmental problems and their resulting consequences to their day-to-day operations. Due to the rising threat of global climate change, the green banking (GB) concept has been given significant attention in recent green finance literature. Therefore, the main purpose of this study was to identify the impact of GB practices on banks’ environmental performance and sources of green financing of private commercial banks (PCBs) in Bangladesh. Using a survey method, the primary data were obtained from a cross-sectional sample of 322 banking employees of PCBs in Bangladesh. In order to identify the key relationships existing between the study variables, structural equation modelling (SEM) approach was employed. The empirical findings indicated that banks’ employees, daily-operations, and policy-related GB practices have significant positive effects on green financing, contrary to banks’ customer-related GB practice, which was not statistically significant. Additionally, banks’ green project financing exhibited a strong and positive influence on banks’ environmental performance. Moreover, banks’ daily operation and policy-related practices of GB were observed to have significant impacts on banks’ environmental performances, in contrast to banks’ employee and customer-related GB practices. Therefore, major policy implications and directions for future research in the concerned area are discussed.

Keywords: green banking practices; banks environmental performance; green financing; SEM; Bangladesh (search for similar items in EconPapers)
JEL-codes: Q Q0 Q4 Q40 Q41 Q42 Q43 Q47 Q48 Q49 (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (10)

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