This research examines the interplay between green financing and the financial performance of commercial banks in Kenya, with a particular focus on the role of corporate governance as a moderating variable. Green financing refers to the investment of financial resources in projects that foster environmental sustainability. As concerns regarding environmental issues grow globally, financial institutions are progressively incorporating green financing into their operational frameworks. This study aims to assess the implications of such practices on the financial stability and competitive positioning of banks within the Kenyan market. Through a comprehensive review of scholarly articles, reports from the Kenya Bankers Association, and various working papers accessed via Google Scholar, the findings indicate a favorable relationship between green financing initiatives and enhanced financial performance. Furthermore, the analysis highlights a general agreement among numerous studies that corporate governance plays a mediating role in the relationship between green financing and the financial outcomes of commercial banks. These findings emphasize the critical significance of adopting sustainable banking practices to bolster profitability while simultaneously advancing environmental sustainability.
Keywords: Financial Performance, green financing, lending in commercial banks., sustainability financing
