Green Finance and CSR: Aligning Corporate Investments with Sustainable Development Goals (SDGs)

Abstract

The paper examines the relationships between green finance, corporate social responsibility (CSR) and alignment with the Sustainable Development Goals (SDGs) of publicly listed companies in Pakistan. This quantitative method was conducted with a sample of 75 listed firms in the PSX and the analysis of data was done using the regression and correlation models. The research established a high positive correlation between the CSR efforts and SDG relations (6.78, p=.001) and between the green finance and SDG relations (4.32, p=.007) with the total explained variance of, 91 percent (R Sq = 0.91). Financial performance is also a key aspect and both CSR ( 2.80, p = .015) and green finance ( 3.25, p = .021) influence better scores on the return on equity (ROE) in addition to both influencing the market valuation (R 2 = .88). The SDG alignment also mediates financial performance but in lesser multiple times. The results strengthen the strategic implication of integrating ESG values into organizational finance and governance. Within the regulatory trends within Pakistan and the world at large with regards to sustainability, green finance and CSR interplay demonstrates that it is not only a matter of ethical compliance in a firm but an important feature to remain profitable in the long term and sustainable in the eyes of investors. The paper provides practical implications to companies, policy makers, and regulators who wish to achieve sustainable growth based on responsible investment and alignment with the SDGs.

Keywords; Corporate Social Responsibility, ESG, Financial Performance, Green Finance, Market Valuation, SDG Alignment, Sustainability, Sustainable Development Goals