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The Effect of Green Investment and Green Financing on Sustainable Business Performance of Foreign Chemical Industries Operating in Indonesia: The Mediating Role of Corporate Social Responsibility

Author

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  • Jianmu Ye

    (School of Management, Wuhan University of Technology, Wuhan 430070, China)

  • Efifania Dela

    (School of Management, Wuhan University of Technology, Wuhan 430070, China)

Abstract

Emerging economies endeavor to achieve a green economy by realizing their potential for sustainable commercial success. Due to natural resource restrictions, businesses must concentrate on green investment, financing, and resources to promote sustainable company performance. To better understand how to implement corporate social responsibility (CSR) and sustainable company performance, this study looks at the effect of green financing and investment. The study used quantitative research techniques through primary and secondary data sources from Indonesia’s 238 sampled international chemical companies. Additionally, a standardized questionnaire was employed in this study to gather data. The study used Smart-PLS and a structural equation model (SEM) to examine the data gathered and determine the relationship between green investment, green financing, CSR, and sustainable business performance. The study shows that green investments and financing significantly and favorably affect CSR and sustainable performance. Additionally, it was found that CSR significantly mediates green investment and green financing with sustainable business performance relationships. This work added to the body of literature and emphasized the significance of each construct. The study’s conclusions also suggested that highly polluting chemical businesses should incorporate green financing, investment, and CSR to improve sustainable economic performance.

Suggested Citation

  • Jianmu Ye & Efifania Dela, 2023. "The Effect of Green Investment and Green Financing on Sustainable Business Performance of Foreign Chemical Industries Operating in Indonesia: The Mediating Role of Corporate Social Responsibility," Sustainability, MDPI, vol. 15(14), pages 1-28, July.
    • Handle: RePEc:gam:jsusta:v:15:y:2023:i:14:p:11218-:d:1196971
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    References listed on IDEAS

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