Oikonomia : Journal of Management Economics and Accounting
Vol. 3 No. 3 (2026): Oikonomia - May

Green Investment and Financial Performance: Analysis of the Impact of Sustainable Investment

Ida Ayu Putu Megawati (Universitas Pendidikan Nasional)
Ni Nengah Rupadi Kertiriasih (Universitas Pendidikan Nasional)
Made Ratih Nurmalasari (Universitas Pendidikan Nasional)
Putu Putri Prawitasari (Universitas Pendidikan Nasional)
Ni Putu Ari Krismajayanti (Universitas Pendidikan Nasional)



Article Info

Publish Date
25 May 2026

Abstract

This study investigates the relationship between green investment and corporate financial performance, analyzing the impact of sustainable investment practices on key financial indicators including Return on Assets (ROA), Return on Equity (ROE), and Tobin's Q. As environmental concerns grow and regulatory frameworks tighten globally, firms are increasingly allocating resources toward environmentally sustainable activities. Drawing upon a systematic review of 20 peer-reviewed studies published between 2018 and 2025, this research synthesizes evidence on whether green investments translate into measurable financial gains or represent a cost burden for firms. The analysis encompasses diverse industries and geographic contexts, including Indonesia, Europe, Ireland, and global markets. Findings reveal that green investment generally yields a positive effect on financial performance, particularly in the long run, though the magnitude varies by industry, firm size, and institutional environment. Environmental, Social, and Governance (ESG) disclosure quality and corporate social responsibility (CSR) practices are identified as significant mediating factors. Green financing instruments such as green bonds also contribute to enhanced corporate performance. This study contributes to the growing body of sustainable finance literature by providing a comprehensive overview of mechanisms linking green investment to financial outcomes and offers.

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Journal Info

Abbrev

oikonomia

Publisher

Subject

Economics, Econometrics & Finance

Description

Oikonomia Journal: Journal of Management Economics and Accounting publishes conceptual, review and research papers related to business and economics. Oikonomia: Journal of Management Economics and Accounting has a focus and scope that includes: Economics Management Accounting Finance Business ...