The Influence of Green Finance Initiatives on the Financial Decision-Making and Sustainable Investment Intentions of Retail Investors

Abstract

This study investigates how green finance initiatives affect the financial decision-making of retail investors and their sustainable investment intentions. A quantitative, cross-sectional research design was used, and primary data were collected from 220 retail investors through a structured questionnaire using a 5-point Likert scale. The five constructs of the study were Green Finance Awareness, Green Financial Literacy, Perceived Benefits of Green Investment, Financial Decision-Making, and Sustainable Investment Intention. IBM SPSS Statistics was used to analyse the data using descriptive statistics, Cronbach’s Alpha, Pearson correlation, and multiple regression analysis. The results showed good levels of reliability for all measurement constructs. Financial Decision-Making was significantly and positively influenced by Green Finance Awareness, Green Financial Literacy, and Perceived Benefits of Green Investment. Additionally, Financial Decision-Making, Perceived Benefits of Green Investment, and Green Financial Literacy significantly influenced Sustainable Investment Intention. The regression model accounted for 38.2% of the variance in Sustainable Investment Intention. The results emphasize the need to enhance investors’ awareness of sustainable investment, strengthen their green financial literacy, communicate the perceived financial and environmental benefits of sustainable investment, and support informed financial assessment. The study offers policy, financial, and investment-platform implications for better engaging retail investors in green finance.