The Impact of Green Accounting on the Financial Performance and Reputation of Commercial Banks

Abstract

This research investigates the impact of environmental accounting practices on the financial performance and reputation of commercial banks. With increasing attention to environmental issues and their growing importance in corporate strategies, the adoption of environmental accounting practices by the banking sector is analyzed to assess their potential impact on financial indicators and the overall managerial standing of the institution. The research uses a comprehensive approach, combining financial performance metrics and reputation assessment, to evaluate the correlation between environmental accounting initiatives and banks' profitability, risk management, and stakeholder perception. Advanced statistical analysis in SPSS software was used to analyze data collected from the study population (bank employees and university professors) to assess the relationship between the adoption of green accounting and the financial performance of banks. The study found that regulators and auditors should support and encourage banks to improve accounting disclosures related to sustainability, and that adopting green accounting practices can enhance their market reputation and make them more attractive to investors and customers interested in sustainability. The study recommended that banks should develop sustainable strategies focused on reducing the negative environmental impacts of their activities and enhancing positive community engagement. Green accounting practices should be systematically integrated into corporate policies and daily operations to achieve a sustained commitment to sustainability.

Keywords

• Green accounting, financial performance, reputation, commercial banks, environmental risk