Does Green Finance Affect Environmental Performance?
Evidence from Nigerian Banks
Abstract
The green environment has become a ubiquitous problem in today's world, where people around the world are voiced against pollution. This study examines the effect of green finance on banks’ performance. Specifically, the study determines the extent to which green loans, green investment, green technology, and green training influence banks’ environmental performance. A non-probability convenience sampling technique was employed on 250 respondents from Nigerian banks. Structural equation modeling (SEM) was used to analyze the data. The results reveal that green loan has a positive and significant association with environmental performance. This implies that financing green loans will improve environmental sustainability. Furthermore, the result shows that green investment has a positive but insignificant influence on environmental performance. This connotes that the majority of Nigerian banks have not been committed to financing investment in renewable energy, waste management, and projects that support the sustainability of the environment. Evidence shows that there is a positive link between green technology and environmental performance. This implies that financing online banking facilities such as ATMs, POS, mobile applications, online customer service platforms, etc has improved banks’ environmental performance tremendously. Also, it was revealed that green training has a direct and significant relationship with banks’ environmental performance. This implies that banks’ environmental management knowledge-driven has improved environmental performance. This suggests to the financial regulatory authorities, bankers, policy-makers, environmentalists, and stakeholders that the financing of green loans, green investment, green technologies, and green training is very important to achieve environmental sustainability.
Copyright (c) 2022 Oloruntoba Oyedele, J. K. Olowookere, Abraham O. Gbadebo, Ademola S. Sajuyigbe
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