The Moderating Role of Environmental Performance in the Relationship between Green Banking and Green Banking Investment

This study examines the relationship between Green Banking and Green Banking Investment and the moderating role of Environmental Performance (PROPER) among banks listed on the Indonesia Stock Exchange (IDX) during ۲۰۲۰–۲۰۲۴. This quantitative study uses secondary data obtained from banks’ annual reports and sustainability reports. The sample comprises ۳۹ banks, resulting in ۱۹۵ firm-year observations. Panel data regression was conducted using the Random Effects Model (REM), with Moderated Regression Analysis (MRA) employed to examine the moderating effect of Environmental Performance (PROPER). The results show that Green Banking is positively and significantly associated with Green Banking Investment, indicating that banks with stronger Green Banking practices tend to allocate a greater proportion of their assets to sustainable investment and financing. However, Environmental Performance (PROPER) does not significantly moderate the relationship between Green Banking and Green Banking Investment. This finding suggests that higher environmental performance (PROPER) does not necessarily strengthen or weaken the relationship between Green Banking practices and green investment allocation. The insignificant moderating effect may be related to the limited variation in Environmental Performance (PROPER) ratings and the different dimensions captured by environmental management performance and sustainable financing allocation. The findings contribute to the Green Banking literature by showing that Green Banking practices are associated with green investment allocation, while Environmental Performance (PROPER) does not necessarily reinforce this relationship. Practically, banks should strengthen the integration of sustainability principles into credit policies, environmental risk management, sustainable financing targets, and investment decisions.

کلیدواژه ها:

Environmental performance (proper) ، ESG ، Green banking ، Green Banking Investment ، Sustainable Banking