Green finance and ESG practices as drivers of multidimensional corporate performance: Evidence from UAE-listed firms

Type of the article: Research Article AbstractGrowing regulatory and investor scrutiny of sustainability has intensified the need to understand whether green finance and environmental, social, and governance (ESG) practices translate into measurable corporate performance gains in emerging markets. This study examines how green finance and ESG practices influence multidimensional corporate performance among firms listed on the UAE stock market. Data were collected via a structured survey of finance and sustainability managers in companies listed on the Abu Dhabi Securities Exchange and the Dubai Financial Market; 167 valid responses (87.4% response rate) were analyzed using structural equation modeling. The survey was administered in the UAE in May 2025. Results show positive effects of green finance on efficiency (β = 0.341, p < 0.01), effectiveness (β = 0.206, p < 0.01), sustainability (β = 0.157, p = 0.041), and customer satisfaction (β = 0.248, p < 0.01). ESG practices also improve efficiency (β = 0.288, p < 0.01), effectiveness (β = 0.179, p = 0.032), sustainability (β = 0.194, p < 0.01), and customer satisfaction (β = 0.142, p = 0.028). Joint modeling indicates complementary effects, with the strongest combined impacts on sustainability (β = 0.376, p < 0.01) and customer satisfaction (β = 0.408, p < 0.01); model fit is strong (GFI = 0.91; CFI = 0.96; RMSEA = 0.014). Overall, integrating green financing with robust ESG practices enhances corporate outcomes in the UAE, providing practical guidance for managers, investors, and policymakers. AcknowledgmentThe authors are thankful to the Deanship of Graduate Studies and Scientific Research at University of Bisha for supporting this work through the Fast-Track Research Support Program.