Evaluating Environmental, Social, and Governance Criteria and Green Finance Investment Strategies Using Fuzzy AHP and Fuzzy WASPAS

The evaluation and prioritization of environmental, social, and governance (ESG) factors are critical for green finance investment strategies. However, ESG criteria are complex and varied concepts that call for a systematic and reliable ranking system to handle ambiguity and uncertainty in decision-...

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Bibliographic Details
Published in:Sustainability 2023-04, Vol.15 (8), p.6786
Main Authors: Meng, Xiaokai, Shaikh, Ghulam Muhammad
Format: Article
Language:English
Subjects:
Banking industry
Business
Carbon
Climate change
Corporate governance
Corporate social responsibility
Corporate sustainability
Criteria
Decision making
Environmental policy
Evaluation
Financial institutions
Fuzzy algorithms
Fuzzy logic
Fuzzy systems
International finance
Investment advisors
Investment policy
Investments
Literature reviews
Management
Performance evaluation
Rankings
Social aspects
Social factors
Socially responsible investments
Sustainability
Sustainable development
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Summary:The evaluation and prioritization of environmental, social, and governance (ESG) factors are critical for green finance investment strategies. However, ESG criteria are complex and varied concepts that call for a systematic and reliable ranking system to handle ambiguity and uncertainty in decision-makers’ preferences and assessments. The objective of this study was to examine and prioritize environmental, social, and governance (ESG) factors and investment strategies for the development of green finance. Although ESG criteria have gained importance recently, some research gaps still need to be filled. For this purpose, evaluating ESG criteria and integrating them with green finance investment strategies is imperative. This study employed the fuzzy analytical hierarchy process (AHP) method to assess and rank ESG criteria and sub-criteria and the fuzzy weighted aggregated sum product assessment (WASPAS) method to assess and prioritize the key investment strategies for the development of green finance. According to the fuzzy AHP findings, governance and social factors are secondary to environmental considerations in the creation of green finance. Green bonds, ESG integration, and renewable energy funds are essential to green finance methods, according to the fuzzy WASPAS data. This research provides information on creating sustainable and ethical investment strategies for green finance and successfully including ESG factors in investment decision-making processes.
ISSN:2071-1050
2071-1050
DOI:10.3390/su15086786