Article Sidebar

Download
Download Article

Main Article Content

Abstract

This study aims to analyze the construction of green finance strategies in promoting the transformation of sustainable investment within financial institutions in Indonesia. Specifically, it explores the factors influencing the adoption of green finance, the challenges encountered in its implementation, and the strategic opportunities for integrating sustainability principles into the national financial system. This research employs a qualitative approach using a systematic literature review method. Data were collected through an in-depth analysis of 47 peer-reviewed articles, regulatory policy documents, and sustainability reports from financial institutions published between 2019 and 2025. Thematic analysis was used to identify patterns, trends, and key findings related to green finance strategies. The results indicate that the development of green finance strategies in Indonesia is influenced by five main factors: a regulatory framework strengthened by the Financial Services Authority (OJK), internal environmental awareness, top management support, financial technology innovation, and external market pressure. The findings also reveal that the integration of Environmental, Social, and Governance (ESG) principles has a positive impact on financial stability and institutional reputation. Furthermore, this study finds that the success of sustainable investment transformation requires a holistic approach involving institutional capacity building, multi-stakeholder collaboration, and the development of innovative green financial products. However, several major challenges remain, including gaps in green financial literacy, inadequate standardization of ESG indicators, and the national economy’s continued dependence on fossil fuels. This study contributes to the literature by providing a comprehensive understanding of green finance strategy construction and its role in strengthening sustainable finance practices in Indonesia.

Keywords

Green Finance Sustainable Investment ESG Financial Institutions

Article Details

Creative Commons License

This work is licensed under a Creative Commons Attribution-ShareAlike 4.0 International License.

How to Cite
Idris, H. (2026). The Construction of Green Finance Strategies in Promoting Sustainable Investment Transformation: A Qualitative Study of Financial Institutions in Indonesia. Golden Ratio of Finance Management, 6(2), 300–310. https://doi.org/10.52970/grfm.v6i2.2046
Download Citation
Endnote/Zotero/Mendeley (RIS)
BibTeX

References

  1. Ahmed, W. (2025). Big data and ESG (environmental, social, governance) reporting in finance. American Journal of Economics and Business Innovation. https://doi.org/10.54536/ajebi.v4i3.6055
  2. Alkaraan, F., & Hussainey, K. (2025). Editorial: Current issues in governance, economics, and finance: Toward ecosystems. International Journal of Finance & Economics. https://doi.org/10.1002/ijfe.70099
  3. Barry, B., Nurjannah, D., & Widagdo, B. (2025). Corporate perspectives on green finance and its influence on firm value and investment strategies in Indonesia. Journal of Applied Finance & Accounting. https://doi.org/10.21512/jafa.v12i2.13934
  4. Bhatia, D., & Kumar, D. (2024). The impact of ESG investing on portfolio performance: An empirical study of emerging markets. Journal of Informatics Education and Research. https://doi.org/10.52783/jier.v4i3.1916
  5. Chiaramonte, L., Dreassi, A., Girardone, C., & Piserà, S. (2021). Do ESG strategies enhance bank stability during financial turmoil? Evidence from Europe. European Journal of Finance. https://doi.org/10.1080/1351847X.2021.1964556
  6. Datta, K., & Jena, P. (2026). Unlocking renewable energy potential through green finance: A bibliometric analysis and systematic literature review. International Journal of Energy Sector Management. https://doi.org/10.1108/IJESM-10-2024-0039
  7. Emmanuel, M. K. (2026). Climate finance and sustainable banking in Tanzania (2020–2024): Emerging roles of AI, mitigation strategies, and regulatory developments—A literature review. Science Mundi. https://doi.org/10.51867/scimundi.6.1.2
  8. Gabr, D. H., & ElBannan, M. A. (2024). Is it worth it to go green? ESG disclosure, carbon emissions, and firm financial performance in emerging markets. Review of Accounting and Finance. https://doi.org/10.1108/RAF-01-2024-0027
  9. Gani, F., Nata, A., Sapriki, Hasibuan, R. G., Williano, & Ruwanti, S. (2025). How do financial literacy, fintech risk, and green risk perception influence investment planning behavior oriented towards green finance? International Student Conference on Business, Education, Economics, Accounting, and Management (ISC-BEAM). https://doi.org/10.21009/isc-beam.013.72
  10. Harnessing artificial intelligence for sustainable finance: A catalyst for green investment. (2024). Recent Trends in Management and Commerce. https://doi.org/10.46632/rmc/5/2/10
  11. Hussain, M., Jaweed, M., Murtaza, M., & Ali, M. (2025). Green bonds and sustainable investment strategies: Evaluating risk-return profiles, market growth, and the role of climate-conscious portfolios in sustainable finance. Advance Journal of Econometrics and Finance. https://doi.org/10.63075/5nggp275
  12. Jamali, M., & Voghouei, H. (2025). Sustainable finance and sustainable development goals: A comparative review of tools, gaps, and governance challenges. Sustainable Development. https://doi.org/10.1002/sd.70492
  13. Junaedi, J. (2024). Understanding the role of finance in sustainable development: A qualitative study on environmental, social, and governance (ESG) practices. Golden Ratio of Finance Management. https://doi.org/10.52970/grfm.v4i2.422
  14. Kartika, R., Tinia, A. G., & Toto. (2025). Faktor-faktor yang mempengaruhi adopsi green finance pada perbankan di Indonesia. Akuntabilitas: Jurnal Ilmiah Ilmu-Ilmu Ekonomi. https://doi.org/10.35457/0d8x0e18
  15. Karumanchi, L. (2024). The role of green financing in accelerating sustainable economic development in emerging economies. International Journal of Transformations in Business Management. https://doi.org/10.37648/ijtbm.v14i03.004
  16. Lakasse, S., Amril, A., Syamsuri, H., & Jusman, I. A. (2024). The role of green finance in sustainable business strategies: Opportunities and challenges for business organizations. Jurnal Penelitian Inovatif. https://doi.org/10.54082/jupin.379
  17. Li, H. (2024). Research on the mechanisms by which green finance policies promote low-carbon economic development. Frontiers in Business, Economics and Management. https://doi.org/10.54097/dvt7ka46
  18. Li, Y. (2025). The performance of green financial instruments and their supporting role in sustainable investment. Advances in Economics, Management and Political Sciences. https://doi.org/10.54254/2754-1169/2025.bj28281
  19. Lusmeida, H., Khomsiyah, & Arsjah, R. J. (2023). Do enterprise risks management, green intellectual capital, and business ethics improve sustainable finance at financial institutions in Indonesia? Journal of Law and Sustainable Development. https://doi.org/10.55908/sdgs.v11i12.2359
  20. Munir, M. (2025). Integration of Islamic finance and green economy in realizing sustainable finance in Indonesia. At-Tahdzib. https://doi.org/10.61181/hjpxf164
  21. Mutmainnah, U. K., Pazizi, M., Muzacky, M. T. A., & Mukhtaruddin, M. (2026). The application of green management accounting in supporting sustainability: A case study of the banking sector in Indonesia. Indonesian Journal of Innovation Multidisipliner Research. https://doi.org/10.69693/ijim.v4i2.492
  22. Nguyen, N., & Dang, M. P. (2025). Does the regulatory framework for financial innovation effectively support sustainable development goals in Vietnam? International Journal of Multidisciplinary Research and Analysis. https://doi.org/10.47191/ijmra/v8-i01-18
  23. Nugroho, R. H., Kusumasari, I. R., Kusbianto, N., Nurhadi, N., & Kurnia, L. (2026). Global trends in green finance in the banking sector: A bibliometric mapping of past and future research directions. Inkubis: Jurnal Ekonomi dan Bisnis. https://doi.org/10.59261/inkubis.v8i1.166
  24. Nurhayati, N. (2024). Analysis of financial managers’ perceptions of corporate sustainability in Indonesia’s sharia banking sector. Journal of Social Science. https://doi.org/10.59613/r2c0hd56
  25. Olugbenga, A. F., & Bali, O. J. (2026). Analyzing the effectiveness of green finance in developing economies: The role of climate-linked investment strategies. International Journal of Latest Technology in Engineering, Management & Applied Science. https://doi.org/10.51583/ijltemas.2026.15020000135
  26. Radhakrishnan, G., Deepa, J., Lonare, A., & Das, P. (2025). The rise of green finance: Sustainable investment trends in the 21st century. Journal of Information Systems Engineering & Management. https://doi.org/10.52783/jisem.v10i33s.5476
  27. Rahmiyati, N. (2025). Green finance and corporate sustainability: Strategic financial management in the era of ESG investing. Jurnal Ilmiah Manajemen Kesatuan. https://doi.org/10.37641/jimkes.v13i6.3987
  28. Raman, R., Ray, S., Das, D., & Nedungadi, P. (2025). Innovations and barriers in sustainable and green finance for advancing sustainable development goals. Frontiers in Environmental Science. https://doi.org/10.3389/fenvs.2024.1513204
  29. Razali, N., Hassan, R., & Zain, N. R. M. (2022). Exploring the regulatory framework of sustainable finance in Malaysia: Driving force for ESG institutional investors. IIUM Law Journal. https://doi.org/10.31436/iiumlj.v30is2.767
  30. Reza, F., Azhari, Sri, R., Fauziah, N., & Yuli, A. (2025). The role of green bonds and sustainable finance in accelerating circular economy transition. The International Conference on Sustainable Economics Management and Accounting Proceeding. https://doi.org/10.32424/icsema.1.1.255
  31. Ridho, T. K. (2025). Finance greenshift: Navigating the path to green finance in emerging countries. Journal of Cultural Analysis and Social Change. https://doi.org/10.64753/jcasc.v10i2.1865
  32. Sa’adah, L., Lestari, L. P., Sari, F. D., Hamzah, A. A., & Argatumewa, B. D. (2025). Analisis implementasi green finance dan kinerja keuangan dalam meningkatkan profitabilitas bank umum konvensional di Indonesia periode 2020–2024. Populer: Jurnal Penelitian Mahasiswa. https://doi.org/10.58192/populer.v4i4.4045
  33. Sakyi, J. K., Eboseremen, B. O., Adebayo, A., Essien, I. A., Okojie, J. S., & Soneye, O. M. (2024). Designing a sustainable financing model for emerging economies: Addressing climate goals through green bonds and ESG investments. International Journal of Multidisciplinary Futuristic Development. https://doi.org/10.54660/ijmfd.2024.5.1.20-33
  34. Setyorini, M., & Hakam, D. (2025). The impact of green banking activities on environmental performance: A youth-driven perception study in Indonesian financial institutions. Journal of Risk and Financial Management. https://doi.org/10.3390/jrfm18100558
  35. Subekti, R. N., Sinaga, J., & Siagian, V. (2026). Corporate finance in a digital green economy: FinTech’s role in enabling sustainable investment and funding models. Community Engagement and Emergence Journal (CEEJ). https://doi.org/10.37385/ceej.v7i5.10946
  36. Suherman, U., Wirdyansyah, D. M., Mighwar, M. A., & Syaie, A. N. K. (2025). Green human resource management in Islamic finance: A systematic review of sustainability strategies in Indonesia. Economica: Jurnal Ekonomi Islam. https://doi.org/10.21580/economica.2025.16.1.25197
  37. Tandan, L., Sharma, R., & Acharya, K. (2025). Is understanding sustainable banking policy an impediment to bankers in the Nepali banking industry? Qualitative Research in Financial Markets. https://doi.org/10.1108/qrfm-05-2024-0139
  38. Thu, D., & Thủy. (2025). Analyzing the impacts of green credit on sustainable development in Vietnam’s banking sector. Panamerican Mathematical Journal. https://doi.org/10.52783/pmj.v35.i4s.4463
  39. Utami, N. (2025). The influence of green investment on investment intention among Generation Z in Indonesia: The moderating role of financial literacy. Transekonomika Akuntansi Bisnis dan Keuangan. https://doi.org/10.55047/transekonomika.v5i2.886
  40. Vanessa, A., Harindahyani, S., & Eriandani, R. (2025). How do investors value environmental social governance (ESG)? A firm-specific context. Akuntansi dan Teknologi Informasi. https://doi.org/10.24123/jati.v18i2.7902
  41. Vy, P. D., & Tam, P. (2025). Policy recommendations for enhancing green banking and sustainable development. Emerging Science Journal. https://doi.org/10.28991/esj-2025-09-06-011
  42. Wenno, M., Faisal, M., Regar, E., & Arifin, H. M. (2025). Green financial management as a strategy to face the challenges of sustainable finance. West Science Business and Management. https://doi.org/10.58812/wsbm.v3i03.2234
  43. Yunus, Y. A., & Nanda, S. (2024). Exploring sustainable finance: A qualitative inquiry into responsible investment and ESG risk evaluation. Golden Ratio of Finance Management. https://doi.org/10.52970/grfm.v4i1.429
  44. Zhang, R. (2025). Green finance and ESG investment strategies under climate risk management. Economics and Management Innovation. https://doi.org/10.71222/00d71j98