Advancing Green Finance through FinTech Innovations: A Conceptual Insight into Opportunities and Challenges

Purpose-The purpose of this article is to study the effect of green financing on the environmental performance of banking institutions in India. This study also focuses on the initiatives undertaken by the banks towards achieving environmental goals. Design/methodology/approach-This research paper is conceptual in nature, based on an extensive review of literature, data from websites of different banking institutions and government websites, and evaluation of other resources. The study focuses on four banks, two banks from the public sector and two from the private sector were selected for the study, that are listed on the NSE Bank Nifty index as of October 2023. These banks were selected based on the following criteria: (a) they actively engage in ESG (Environmental, social, and Governance) activities and disclose them in their sustainability reports. Based on this criterion, we have found that only two public sector banks (State Bank of India and Bank of Baroda) out of three that are indexed in NSE Bank nifty, meet these requirements. Therefore, to match the number of banks with the public sector and to provide diversity, we have decided to select two private sector banks that also meet the above criterion and since we have more private sector banks following these criteria, we have further decided to choose the banks on other criteria: (b) the banks with highest net profitability for the year 2022-23. So, based on this, two private sector banks (HDFC Bank and ICICI Bank) out of Eight large private sector that were indexed were selected. Findings-This study has explored the relationship between green financing and the environmental performance of a few selected Indian banks, both public (State Bank of India and Bank of Baroda) and private sector (HDFC Bank and ICICI Bank). It was found in all selected banks that green financing and environmental performance are positively related and green initiatives have a significant impact on the environment. These banks are successfully reducing their negative impact on the environment through green financing in eco-friendly projects. It also indicates the green energy (renewable sources) is crucial for a good future and helps fight climate change and this will also require a lot of money in the form of green financing. Countries (e.g., the United States, China, Germany, Netherlands, etc) that have adopted these eco-friendly strategies have seen benefits for their economy and the environment. The study also noticed that Public and private banks might have different approaches to doing things, but they might also be working towards the same green goals of the country. The study also found that we need better rules (ESG frameworks), like the one used by the State Bank of India. In this regard we can also take an example from Triodos Bank (Netherlands), Nordea (Sweden), and Rabobank (Netherlands) as these are the top banks in the world that are adopting the best sustainable banking practices (as per the article of Fintech Magzine February 20, 2023), so from there we can also adopt policies and measure as per our Indian context. The study also revealed that there is a need for government support, clear policies, and increased transparency in financial reporting where we are investing money in environmentally friendly and non-Frontiers of Finance Volume 1 Issue 1 (2023) 2 / 18 environmental projects. Also, for the green revolution in India, there is a need for a strong partnership among Indian governments and financial institutions. These things together with cultural changes help promote sustainability and better environmental performance that guarantees a resilient future. The study helps in understanding the relationship between green financing and environmental performance. The study highlighted that there is a positive impact of green financing in promoting sustainability. The findings stress incorporating environmental factors in financial decisions. The research identifies a gap in India's green financing understanding and urges further exploration. Currently, India's banks are at an early stage in adopting green financing practices, while some countries have made significant progress. So, this is one of the earliest studies conducted in the country that seeks to establish a relationship between green finance practices and environmental performance, especially focusing on the banking industry. It has been focusing primarily on some main public as well as private sector banks in India. Limitations: While this study has provided essential information, there are some limitations that need to be focused on in future research. One of the major limitations is that the study only looked at the green finance practices and environmental performance of a few commercial and public sector banks in India using secondary data, which limits the scope and generalizability of the findings. Managerial implications: We have identified key points from our study that can be applied to the banking sector. They are: Firstly, there is a need to enhance the transparency of financial reports. When providing details on the financial breakdown, banks must indicate the funds allocated to both green energy and non-green energy projects. Secondly, each bank must adopt Environmental, Social, and Governance (ESG) norms compulsorily. These norms should be integrated into their day-to-day business operations, ensuring responsible lending practices. Thirdly, all banks should establish a green financing framework, taking inspiration from the success of the State Bank of India. Additionally, collaborating with renewable energy initiatives and promoting environmentally friendly financing practices are crucial steps towards a greener and more sustainable approach. Lastly, each bank should engage in the development of green products and services, fostering innovation with a sustainability focus. By following these practical implications, Indian banks can become significant contributors to sustainable development and the reduction of the effects of climate change. Social implications: are considerable. It places a focus on addressing the societal and environmental effects of climate change. It fosters ethical lending and a sustainable future by showing successful cases. The importance of policy frameworks for green finance is emphasised, along with collaboration between governments and banks. Adopting environmentally responsible financing can improve sustainability, environmental performance, and resilience for future generations. Originality/value-The authors provide one of the first reviews of the effect of green finance on environmental performance in India concentrating on initiatives undertaken by different public and private sector banks.

This study focused to understand the impact of the social pillar of ESG (Environmental, Social, and Governance) practices on the sustainability of organizations. A systematic review of the literature was carried out and the analysis of these articles revealed that in recent years investors have shown a growing interest in ESG, guided by financial value. ESG data, scientifically grounded and focused on investments, offers greater transparency to investors, but faces challenges in defining metrics due to the distinct nature of the three pillars. Companies with better ESG performance also contribute to community development. However, the social dimension of ESG has received less attention than the environmental and economic dimensions. Human-centric organizations that use ESG practices make an impact on the environment by implementing sustainable measures that reduce health risks and workload. In the social sphere, labor management, diversity and inclusion programs increase satisfaction and productivity at work. In corporate governance, improved strategies should consider employees' occupational stress and gender diversity in senior management and boards, as it plays a key role in ESG disclosure and performance. There are gaps in the literature regarding the three ESG pillars, especially regarding the social dimension and diversities. The lack of academic consensus on the impact of engaging in ESG practices indicates the need for more studies and empirical research to advance knowledge about ESG and sustainability in organizations. Overcoming these limitations can allow for a better understanding and effective implementation of ESG practices, boosting organizational sustainability.

In recent years, the intersection of finance and sustainability has garnered significant attention as the global community grapples with the urgent need to address environmental challenges. This abstract explores the role of fintech innovations in supporting green finance through data-driven approaches. Fintech, characterized by its use of technology to enhance financial services, has emerged as a key driver of sustainability by leveraging data analytics, machine learning, and blockchain technology to promote environmental sustainability and facilitate green investments. Fintech innovations are revolutionizing green finance by providing investors, businesses, and consumers with tools and platforms to make informed decisions that align with sustainability objectives. By harnessing the power of big data and advanced analytics, fintech companies are able to analyze vast amounts of environmental, social, and governance (ESG) data to assess sustainability risks and opportunities, develop sustainable investment strategies, and track the environmental impact of financial portfolios. One of the key contributions of fintech to green finance is the development of sustainable investment platforms that enable investors to allocate capital towards environmentally friendly projects and companies. These platforms leverage data analytics to screen investments based on ESG criteria, provide transparency into the environmental footprint of investments, and empower investors to make sustainable choices that align with their values and preferences. Furthermore, fintech innovations are facilitating the integration of green finance principles into traditional financial services, such as banking, lending, and insurance. By leveraging blockchain technology, fintech companies are enhancing transparency, traceability, and efficiency in sustainable supply chains, carbon trading, and renewable energy financing. However, challenges remain in harnessing the full potential of data-driven sustainability in fintech. These challenges include data privacy and security concerns, regulatory uncertainties, and the need for greater collaboration and standardization among stakeholders. In conclusion, data-driven sustainability represents a transformative force in green finance, with fintech innovations playing a pivotal role in driving the transition to a more sustainable and resilient financial system. By leveraging data analytics and technology, fintech companies are empowering stakeholders to make informed decisions that promote environmental stewardship and support the transition to a low-carbon economy.
 Keywords: Data-Driven, Sustainability, Fintech, Innovation, Green Finance.

The challenge of Environmental, Social and Governance (ESG) has been identified as being inextricably linked to organisational culture, with these aspects being embedded within the company’s values and practices. The companies’ commitment in promoting sustainability, diversity and ethics in their activity is considered to be a prerequisite for effective performance in relation to all categories of stakeholders. The increased interest in the relationship between ESG and financial performance has led to a substantial volume of research. This paper’s objectives are to broaden the discussions of the relationship between ESG and financial performance, through a bibliometric analysis of 1461 articles. The following themes were identified as the primary subjects of research: corporate disclosure of ESG information and financial performance; ESG, volatility, risk and return; corporate ESG performance and dividend payment; the financial performance indicators in association with ESG performance; ESG, development, innovation, digitisation; ESG performance and earnings management; and ESG controversies and business performance. The trends in the research of the topic concerned the particularities of the relationship between the variables in times of crisis, the correlation between the variables moderated by reporting, the analysis of different ESG ratings, green financing, the particularities in the banking system, materiality and sectoral particularities, as well as ESG disclosure and corporate financial flexibility. The results of the study enhance understanding of this relationship, being useful to both stakeholders and scholars, identifying trends and tendencies in this issue, and providing directions for future studies to establish the determining factors and performance practices.

PurposeThis paper systematically analyzes the literature on environmental, social and governance (ESG). It explores the antecedents, decisions and outcomes (ADO) influencing ESG investments; theories used in the literature; publication years, geographical locations and journals of publication of ESG-related articles; notable gaps in research on ESG investments; theoretical and managerial implications and prospective research avenues within the ESG field. All ESG components are interconnected with the United Nations’ Sustainable Development Goals (SDGs).Design/methodology/approachThe PRISMA framework was employed to screen articles from the Scopus database. A total of 386 articles spanning 2011–2024 were included. The search terms used to screen the articles for inclusion were “sustainable finance,” “ESG,” “environment, social, corporate governance,” “green finance,” “green bond,” “social bond,” “blue bond,” “social finance” and “corporate social responsibility.”FindingsThe findings indicate that organizations utilize green bonds, blue bonds and green loans to mitigate environmental concerns. To address social issues, companies issue social bonds and sustainable bonds and engage in socially responsible investing. To address concerns about corporate governance, companies emphasize corporate social responsibility and intellectual capital.Practical implicationsThe findings can be used to inform policymakers on the implementation of comprehensive regulatory frameworks in the realm of ESG. Tax benefits and subsidies should be extended to firms fostering ESG practices.Originality/valueThis study offers a comprehensive synthesis of the ESG literature by examining the ADO framework, which has not been systematically applied to ESG investments before. It integrates diverse components of ESG investments with the United Nations’ SDGs, providing a unique perspective on how these investments align with global sustainability objectives.

As China enters a new era of development, high-quality development and China's Double-Carbon Policy have become new goals, and environmental, social and governance (ESG) is gradually being emphasized. ESG is becoming a key consideration for sustainable corporate development. However, the ESG concept started late in China, and relevant case studies are not sufficient to provide effective experience and behavioral guidance for corporate ESG practices. Considering the current situation, this study employs the case study method and comparative analysis method, and takes Industrial Securities, a representative company in China's financial industry, as a case study company to explore its ESG practices and governance effectiveness from three dimensions: environment, society, and governance. As a result of the study, it was found that under an effective ESG governance system, Industrial Securities has achieved results in green finance, social responsibility and ESG ratings. Industrial Securities has formed a unique sample in ESG practice, which provides experience for ESG governance of other Chinese enterprises, and promotes the implementation and development of ESG in the company itself as well as in China's domestic capital market.

This paper adopted a case study approach to explore the role of partnerships between government, industry and education in transforming Hong Kong into a green finance hub. Findings from several interviews with the bank and finance companies in Hong Kong are presented, adding a new dimension to the existing literature in terms of providing new theoretical understanding to current practices with the intention of introducing environmental, social and governance (ESG) or sustainability related programs in the banking and finance industry of Hong Kong. The paper conceptualized existing partnership patterns in the finance industry with the education sector and government across the industry and explored their skills needs for the green economy. The study reported in the paper highlighted that there is need to scale up green finance market development in promoting environmental sustainability in Hong Kong. This requires specific green finance developmental strategies from the government, finance and banking business community as well as the support of partnerships with universities. Our results revealed that vocational professional educational and training providers may not have a significant impact and neither will they share a significant role in greening the finance sector. A theoretical model adopted for the study (quintuple helix model) was used to illustrate the interaction and the flow of knowledge and innovation between different actors in support of sustainable development (Carayannis et. al., 2012). Based on this model, a framework to support effective partnerships for greening the finance industry is suggested. Such actions as the uptake of green bond and social responsible investment and improving disclosure standard of environmental, social and governance aspects in the field are proposed as important aspects for partnerships.

With the advancement of global sustainable development strategies, green finance has become a core driver of economic transformation and upgrading, and the development of environmental, social and governance (ESG) investment concepts has challenged traditional asset pricing models. Increasing investor attention to ESG factors has led to a shift in investment decision logic from single financial returns to multi-dimensional sustainability assessments. By combing the existing literature, this article discusses the transformation of investor behavior and the limitations of the CAPM and Fama French five-factor model in the context of green finance. The study shows that companies with good ESG performance receive higher market recognition and lower financing costs, while the CAPM model fails to fully explain asset returns because it does not incorporate ESG factors and investor sentiment. And although the Fama-French five-factor model has some explanatory power, it does not cover ESG dimensions, and some of the factors perform redundantly in the A-share market. However, after adding ESG factor, the performance of the model is improved, especially in the grouping of small capitalization and value stocks. Therefore, in the context of green finance, investor behavior presents ESG integration and sentiment-driven features, which challenge the validity of traditional pricing models.

As a new practice in finance, world communities are incorporating environmental, social and governance (ESG) interests into our financial practice terming it as Green Finance. ESG`s core concept and the United Nations Sustainable Development Goals 2030 help spread this west evolved concept to developing countries. Nepal, a developing country in need of foreign funding, seems to have succumbed to green finance practices as it has become one of the fundamental goals of key economic players such as the World Bank and the IMF. This qualitative research tried to explore the present positioning of Nepalese commercial banks regarding incorporation of the concepts of green finance in their financial planning, decision making and operation by collecting data through seven semi structured interviews with commercial bankers. Findings are analyzed under different themes i.e. understanding of green finance, common green finance practices and challenges faced while implementing it. This study concluded that green finance being a nascent concept is superficially understood, is practiced just to meet the minimum NRB guidelines, has economical and operational constraints, and needs rational amendments in guidelines for local acceptance yielding desired outcomes.

Biomechanics boost human health and performance. Sports not only promote the improvement of national physical fitness, but also promote the development of fitness equipment manufacturing industry. Sports injuries, such as fractures, require the consultation of orthopedic doctors, and fitness requires the guidance of coaches, which to a certain extent promotes the employment of biomechanics researchers. Therefore, the potential of biomechanics is for improving human health and Environmental, Social and Governance (ESG) performance is well established. Green finance can provide financial support for the sustainable development of the manufacturing industry. Whether green finance, as a financial tool that combines healthy, environmental and economic benefits, has a significant impact on the ESG performance of enterprises that are highly concerned by government departments and investors at present still requires in-depth research. This paper, from bio-mechanics perspectives, based on data from listed manufacturing companies in China from 2013 to 2022, examines the impact of green finance on the ESG performance of manufacturing enterprises (especially, sports facilities manufacturing enterprises) by constructing a fixed-effects model. The research findings are as follows: First, green finance prompts citizens choose low-carbon transport, such as cycling, running, or new energy vehicles. It is not only conducive to improving citizens’ physical fitness and the environment, but also conducive to the development of sports facility manufacturing companies and auto-mobile manufacturing companies. Second, green finance significantly enhances the ESG performance of manufacturing enterprises, and this conclusion has been robustly tested through methods such as replacing the explained variable, incorporating dummy variables, and employing instrumental variable techniques. Third, green finance improves the ESG performance of enterprises by alleviating financing constraints and promoting green technological innovation in the manufacturing sector. Finally, green finance has a more significant impact on enhancing the ESG performance of non-state-owned manufacturing enterprises and technology-intensive manufacturing enterprises. This study provides an in-depth exploration of the extent and mechanisms through which green finance influences the ESG performance of Chinese manufacturing enterprises, offering policy references for accelerating the green transformation and up-grading of China’s manufacturing sector.

This research dissected the eleven challenges faced by Malaysian micro, small and medium enterprises (MSMEs) to adopt environmental, social and governance (ESG) standards. Highlighting the economic prominence of Malaysian MSMEs that constituted 39.1% of the gross domestic product of Malaysia in 2023, the research pursued the gap on the absence of a cost effective and time efficient ESG pathway. Enabling MSMEs to continue advancing global competitiveness of large corporations while boosting Malaysia’s low carbon transition is the research objective. The research deployed a qualitative online structured interview approach supplemented with document review and triangulation to unveil the three dominant challenges of regulations and policies, finance, and supply chain. Totally, the research selected 29 ESG knowledgeable interviewees. In the order of relative importance, the challenges exploited encompassed regulations and policies, green finance, green supply chain, access to ESG information and technology, availability of ESG facilitators, government aids and grants, resources within MSMEs, education and awareness, ethical products market demand, mindset of MSMEs, and public-private partnership. Using institutional theory to elucidate how coercive, mimetic, and normative pressures influenced ESG standards adoption, the research discovered the Regulations, Finance and Supply Chains (RFSC) novelty pathway. Pivoting on the National Sustainability Reporting Framework and leveraging on Greening Value Chain and Low Carbon Transition Facility, the research proposed the navigation of the RFSC novelty pathway to overcome the dominant ESG challenges faced by Malaysian MSMEs, emphasizing the bridging roles of non-governmental organizations and decarbonization potential of Bursa Carbon Exchange, along the way.

The global transition toward carbon neutrality has amplified the role of green finance, with ESG (Environmental, Social, and Governance) performance becoming a critical determinant of corporate financing decisions. In Chinathe largest emerging market and carbon emitterrecent policy innovations, such as green finance pilot zones and carbon emission reduction instruments, have accelerated ESG adoption. However, existing studies predominantly focus on linear ESG-financing relationships, overlooking nonlinear mechanisms, regional policy synergies, and technological disruptions like blockchain. This study examines the impact of ESG performance on financing constraints using panel data from Chinese A-share listed firms (20102020). Employing a progressive modeling framework (POLSOLSFEtwo-way FE), it systematically address endogeneity through financial controls, fixed effects, and robustness checks with alternative ESG metrics. Heterogeneity analyses reveal attenuated ESG effects in environmentally sensitive industries (=-0.161 vs. -0.294) and state-owned enterprises (=-0.106 vs. -0.323), attributable to regulatory compliance costs and soft budget constraints. The findings support the ESG signaling framework wherein enhanced disclosure reduces information asymmetry. Policy implications emphasize standardized ESG disclosure aligned with China-specific materiality and differentiated regulatory interventions across industries and ownership types.

With the global sustainable development goal and the rise of corporate social responsibility, ESG (environmental, social and governance) information transparency has become an indispensable part of enterprise management. The purpose of this paper is to explore how blockchain technology can be used as an innovative tool to provide effective support for improving the transparency of ESG information. Firstly, this paper establishes a theoretical framework, drawing lessons from transaction cost economics, information asymmetry theory and corporate governance theory to understand the theoretical impact of blockchain technology on ESG. Subsequently, through empirical research, this paper collects and analyzes ESG information of enterprises in different industries and regions, and shows the actual effect of blockchain technology in ESG compliance, data accuracy and transparency. The research results show that blockchain technology has significantly improved the overall performance of enterprises in the ESG field. However, while achieving results, this paper also found room for improvement in standardization, technical performance and smart contracts. Finally, this paper puts forward some suggestions for future research, including in-depth industry research, long-term impact research and investigation of regulations and policies, in order to provide more reliable theoretical and empirical support for the wide application of blockchain technology in ESG information transparency. This study provides far-reaching enlightenment for building a more transparent and sustainable business ecosystem.

Agribusiness is an important sector of the global economy, and ESG practices are gaining increasing importance in this sector. This study intends to analyze scientific production on ESG (environmental, social, and governance) aspects applied to the agribusiness sector based on documents indexed on the Web of Science database and CAPES periodicals from January 2013 to September 2023. The analysis of the selected articles was carried out through a systematic review of the literature, following strict inclusion and exclusion criteria. The search was carried out using keywords and Boolean operators directly in the search databases. After applying the “filters”, five articles remained that met the established criteria. The results indicate that ESG plays a fundamental role in the agribusiness sector, contributing to sustainability, social responsibility, profitability, and competitiveness. However, there are still challenges to be faced in the effective implementation of ESG practices, requiring greater collaboration between interested parties.

Green finance and carbon emission management are critical to addressing global climate change and achieving sustainable development. In the context of real-world challenges, the intensifying global climate crisis has heightened the focus on carbon emissions among governments, corporations, and financial institutions. The Paris Agreement and national carbon neutrality goals have propelled green finance into the spotlight as an essential economic tool. Green finance, through mechanisms such as green bonds, green loans, and ESG (Environmental, Social, and Governance) investments, supports the financing and implementation of environmental projects. This not only aids companies in transitioning to low-carbon operations but also enhances the overall sustainability of the economy. Carbon emission management is a vital strategy for businesses striving for sustainability. So this study explores the role of green finance in fostering good corporate carbon emission management. This study first discusses the current severe environmental issues related to carbon emissions in both China and overseas to highlight the importance of green finance. Then the article shows the basic theories of green finance and its development across the globe. Finally, some previous research was cited a specific way and finally, the conclusion was drawn that green finance makes corporate carbon emission reduction efficient, and then the study shows what can people do to further promote green finance.