Balancing Framing Effects In Green Finance

Abstract

Sustainable development has been a principal matter for a significant period of time. To facilitate sustainable development, need for responsible investing has been reinforced, serving as the corner stone for the growth of green finance. Institution investors’ investment is often driven by the economic factors that are available in the market however; Individual investor’s investment decision is consistently modeled by the framing of the information that is available in the market. This research is intended to examine how different framing strategies impact the individual investor’s choices in green finance. Drawing from the understanding that framing of the information impacts significantly, the study explores the influence of these frames on likelihood of investment, investment amount, perceived risk and return and environmental impact perception.

The study incorporates a quantitative methodology to examine the mediating role of risk tolerance in the relationship between framing and investment decisions. This framework acknowledges that incremental changes in information can substantially change investors’ behavior impacting the capital investment in green initiatives. The findings will shed light onto how communication strategies alongside financial products can be designed to communicate the importance and impact of green investments, taking into account the multifaceted risk profiles of individual investors. In conclusion the research seeks to contribute to strategic development that augments investor interaction in green market, facilitating greater accountability and value-driven investment decisions in congruence with sustainable development goals