FINANCIAL FACTOR AS A PART OF THE ENVIRONMENTAL PROTECTION PROBLEM

Abstract

The environment is constantly changing, including because of human impact. Over the past decades, society has faced many environmental problems that have led to ecosystem deterioration and may become global disasters and tragedies. Their solution is possible through the development of modern methods of rationalizing nature management, transforming the economy, finding optimal financial support mechanisms, and reforming public policy to achieve climate neutrality and sustainable development of society. The study aims to identify the impact of economic factors on environmental protection. The following methods were used during the study: analysis, synthesis, comparison, and generalization. Considering the issue of environmental protection, the author analyzes the effectiveness of environmental and economic policies of different countries based on the Environmental Performance Index, which showed that during 2016-2022 the composition of the top 10 changed dramatically, indicating that measures aimed at preserving the NPS were not systematically taken. It is established that the financial sector has a twofold impact on the environment. The degree of financial development has a positive side effect, while the optimization of the industrial structure has a negative one. The country's economic growth is essential to solving the problems related to environmental protection, which allows investing in environmental protection measures. The downside is the industrialization and urbanization of society, which contributes to economic prosperity and simultaneously leads to ecosystem pollution. One of the main strategies to curb the degradation of the NPS is to implement financial accessibility. Increasing the environmental friendliness of production can be achieved operationally and strategically. Many developing countries are developing and implementing plans to reduce their vulnerability to climate change in their national strategies. The article shows that "green" finance is one of the new ideas related to the responsibilities of the financial sector in addressing the significant challenges of our time in a way that ensures the creation of corporate and social value without harming the environment. Keywords: environment, environmental protection, pollution, finance, green.