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Green Financing, Green Innovation, and Financial Performance of Indonesian Listed Banks Nurhikmah S.R, Nurhikmah; Nasrullah, Nasrullah; Ismawati, Ismawati
Jurnal Minds: Manajemen Ide dan Inspirasi Vol 13 No 3 (2026): December
Publisher : Management Department, Universitas Islam Negeri Alauddin Makassar, Indonesia

Show Abstract | Download Original | Original Source | Check in Google Scholar | DOI: 10.24252/minds.v13i3.70821

Abstract

This study examines the effect of Green Financing on financial performance through the mediating role of Green Innovation in Indonesian listed banking companies. It contributes to the sustainable finance literature by explaining how Green Innovation serves as a strategic mechanism linking Green Financing to financial performance. The study employs a quantitative approach using panel data from 14 banks listed on the Indonesia Stock Exchange during 2022–2024. Green Financing is measured by the natural logarithm of total sustainable financing, Green Innovation by the Green Innovation Disclosure Index (GIDI), and financial performance by Return on Assets (ROA), Return on Equity (ROE), and Capital Adequacy Ratio (CAR). Panel regression and Sobel mediation tests reveal that Green Financing significantly promotes Green Innovation. Green Innovation negatively affects ROA and ROE but positively influences CAR while significantly mediating the relationship between Green Financing and financial performance.