Climate change governance, Shariah governance quality, and financed emission mitigation: Evidence from Islamic banks in Southeast and West Asia
The financial sector holds major responsibility in climate mitigation, as the proliferation of environmental damage within the real economy largely stems from the negative externalities of the financial economy. Islamic banking, as a subset of the global financial market, is often adjudged as a prom...
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| Format: | Article |
| Language: | English |
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Elsevier
2025-07-01
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| Series: | Borsa Istanbul Review |
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| Online Access: | http://www.sciencedirect.com/science/article/pii/S2214845025000560 |
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| author | Saheed Olanrewaju Issa Abdulkadri Toyin Alabi Abdulbaki Teniola Ubandawaki |
| author_facet | Saheed Olanrewaju Issa Abdulkadri Toyin Alabi Abdulbaki Teniola Ubandawaki |
| author_sort | Saheed Olanrewaju Issa |
| collection | DOAJ |
| description | The financial sector holds major responsibility in climate mitigation, as the proliferation of environmental damage within the real economy largely stems from the negative externalities of the financial economy. Islamic banking, as a subset of the global financial market, is often adjudged as a promoter of ethical practices. This study investigates how climate governance mechanisms and Shariah governance quality influence Islamic banks’ mitigation of financed emissions. Data was obtained from the LSEG database and the annual reports of 28 sampled Islamic banks covering the period of 2019–2023. The results of logistic regression indicate that sustainability committees, sustainability reporting, and Shariah governance quality positively affect financed emission mitigation in Islamic banks. This study therefore recommends for Islamic banks to adopt robust climate governance mechanisms, as well as for regulators to institutionalize policies mandating sustainable finance. |
| format | Article |
| id | doaj-art-ba4a5e2ce75446efbba5ed2bd8df0b2d |
| institution | Kabale University |
| issn | 2214-8450 |
| language | English |
| publishDate | 2025-07-01 |
| publisher | Elsevier |
| record_format | Article |
| series | Borsa Istanbul Review |
| spelling | doaj-art-ba4a5e2ce75446efbba5ed2bd8df0b2d2025-08-20T03:24:07ZengElsevierBorsa Istanbul Review2214-84502025-07-0125472273210.1016/j.bir.2025.03.011Climate change governance, Shariah governance quality, and financed emission mitigation: Evidence from Islamic banks in Southeast and West AsiaSaheed Olanrewaju Issa0Abdulkadri Toyin Alabi1Abdulbaki Teniola Ubandawaki2Department of Accounting, School of Business and Economics, Universiti Putra Malaysia, Serdang, Malaysia; Corresponding author.Department of Accounting, School of Business and Governance, Kwara State University, NigeriaCenter for Applied Research on the Environment and Sustainability (CARES), The American University in Cairo, Cairo, EgyptThe financial sector holds major responsibility in climate mitigation, as the proliferation of environmental damage within the real economy largely stems from the negative externalities of the financial economy. Islamic banking, as a subset of the global financial market, is often adjudged as a promoter of ethical practices. This study investigates how climate governance mechanisms and Shariah governance quality influence Islamic banks’ mitigation of financed emissions. Data was obtained from the LSEG database and the annual reports of 28 sampled Islamic banks covering the period of 2019–2023. The results of logistic regression indicate that sustainability committees, sustainability reporting, and Shariah governance quality positively affect financed emission mitigation in Islamic banks. This study therefore recommends for Islamic banks to adopt robust climate governance mechanisms, as well as for regulators to institutionalize policies mandating sustainable finance.http://www.sciencedirect.com/science/article/pii/S2214845025000560Financed emission mitigationClimate governanceShariah governanceIslamic banks |
| spellingShingle | Saheed Olanrewaju Issa Abdulkadri Toyin Alabi Abdulbaki Teniola Ubandawaki Climate change governance, Shariah governance quality, and financed emission mitigation: Evidence from Islamic banks in Southeast and West Asia Borsa Istanbul Review Financed emission mitigation Climate governance Shariah governance Islamic banks |
| title | Climate change governance, Shariah governance quality, and financed emission mitigation: Evidence from Islamic banks in Southeast and West Asia |
| title_full | Climate change governance, Shariah governance quality, and financed emission mitigation: Evidence from Islamic banks in Southeast and West Asia |
| title_fullStr | Climate change governance, Shariah governance quality, and financed emission mitigation: Evidence from Islamic banks in Southeast and West Asia |
| title_full_unstemmed | Climate change governance, Shariah governance quality, and financed emission mitigation: Evidence from Islamic banks in Southeast and West Asia |
| title_short | Climate change governance, Shariah governance quality, and financed emission mitigation: Evidence from Islamic banks in Southeast and West Asia |
| title_sort | climate change governance shariah governance quality and financed emission mitigation evidence from islamic banks in southeast and west asia |
| topic | Financed emission mitigation Climate governance Shariah governance Islamic banks |
| url | http://www.sciencedirect.com/science/article/pii/S2214845025000560 |
| work_keys_str_mv | AT saheedolanrewajuissa climatechangegovernanceshariahgovernancequalityandfinancedemissionmitigationevidencefromislamicbanksinsoutheastandwestasia AT abdulkadritoyinalabi climatechangegovernanceshariahgovernancequalityandfinancedemissionmitigationevidencefromislamicbanksinsoutheastandwestasia AT abdulbakiteniolaubandawaki climatechangegovernanceshariahgovernancequalityandfinancedemissionmitigationevidencefromislamicbanksinsoutheastandwestasia |