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Green Financial Management and its Impact on Small Medium Enterprises (SMEs): An Empirical Study in Indonesia

Faculty of Business and Economics, Universitas Hasanuddin, Kec. Tamalanrea, Kota Makassar, Sulawesi Selatan 90245, Indonesia

E-mail Address: mursalimnohong@fe.unhas.ac.id

Corresponding author.

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Muhammad Sobarsyah

https://orcid.org/0009-0006-1557-5490

Faculty of Business and Economics, Universitas Hasanuddin, Kec. Tamalanrea, Kota Makassar, Sulawesi Selatan 90245, Indonesia

E-mail Address: msobarsyah@yahoo.com

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Nur Alamzah

https://orcid.org/0009-0002-3560-7315

Faculty of Business and Economics, Universitas Hasanuddin, Kec. Tamalanrea, Kota Makassar, Sulawesi Selatan 90245, Indonesia

E-mail Address: alamzah.nur95@gmail.com

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Andi Sylvana

https://orcid.org/0009-0005-9024-8345

Faculty of Business and Economics, Universitas Terbuka, Kec. Medan Denai, Kota Tangerang Selatan, Banten 15437, Indonesia

E-mail Address: sylvana@ecampus.ut.ac.id

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, and

Bahtiar Herman

https://orcid.org/0000-0002-5679-6699

Faculty of Business and Economics, Universitas Muhammadiyah Sidenreng Rappang, Maccorawalie, Panca Rijang, Sidenreng Rappang Regency, South Sulawesi 91651, Indonesia

E-mail Address: bahtiarherman.bh@gmail.com

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https://doi.org/10.1142/S1464333224500017Cited by:3 (Source: Crossref)

Abstract

This study investigates the relationships between Green Financial Management (GFM), Green Operational Practices (GOP), and Financial Performance (FP) within Indonesian firms, offering new insights into the strategic importance of sustainability in financial management. We conducted a multivariate analysis of data obtained from a sample of 256 firms in Indonesia. The results reveal a significant positive association between GFM and GOP and a subsequent improvement in FP. Moreover, our study finds that the Regulatory Environment (RE) and Market Competition (MC) play moderating roles in the GFM–GOP relationship. In contrast, the GOP serves as a mediator between GFM and FP. Despite various limitations, this research offers crucial empirical support for the idea that green finance management may enhance a company’s environmental responsibility and financial success. The report also identifies areas for further investigation, emphasising how crucial sustainability is to corporate strategy planning.

Keywords:

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