Building sustainable banks: Effects of green HRM practices on green environmental performance

Abstract

The paper assesses the impact of green human resource management (GHRM) practices on green environmental performance within the banking industry. The assessment is guided by a positivist research philosophy and thus adopts a quantitative approach using a cross-sectional survey design. Primary data were collected from 394 respondents who are employees in the banking sector, selected based on convenience sampling, through structured questionnaires. Analysis was done in SmartPLS 4 for both measurement and structural models that also included regression-based path analysis to test interactions. The results indicate a strongly significant positive effect of green involvement, green pay and rewards, and green training on environmental performance. This means that banking firms can achieve sustainability outcomes with the implementation of these practices. There is no significant positive relationship between the implementation of green recruitment and selection and environmental performance.  Banks need to work on increasing employee participation in environmental activities and green-linked reward systems while focusing on environment-related training programs. This paper provides industry-specific empirical evidence from the banking sector to contribute to the literature on GHRM and elucidates particular GHRM practices that are important for environmental performance.