Sustainable Banking: Leveraging Employee Behavior for Environmental and Competitive Gains

Green banking is becoming increasingly vital for sustainable competitiveness within the financial sector. This study investigates the role of employee green behavior in driving green banking performance within small finance banks. Employing a PLS-SEM approach on survey data collected from 282 employees, we identified green training and development as the most potent driver of green behavior, followed by environmental values and green innovation. These findings suggest that targeted training programs to foster a foundational understanding of green practices may have a more significant initial impact in smaller banks with less established green cultures. Importantly, the study reveals that green behavior acts as a mediator, strengthening the relationship between sustainable factors and green banking performance. This underscores the critical role of employee green behavior in translating sustainable initiatives into tangible results. The research highlights the significance of advanced management practices, particularly employee green behavior training, in fostering a greener workforce. By investing in such training, small banks can empower their employees to contribute effectively to sustainable advancements, ultimately gaining a competitive edge in the evolving financial landscape.