Unraveling the role of environmental emotional connectedness and sustainable returns in green finance decisions: a comparative analysis

The study aims to identify the underlying forces shaping investors’ green financing decisions, specifically examining whether these decisions are driven by emotional connectedness to the environment or by the pursuit of sustainable financial returns. These latent motivations may influence investment behavior either consciously or unconsciously. In addition, the study analyzes investors’ preferences under trade-off conditions involving environmental emotional connectedness, expected sustainable returns, and investment duration. To investigate these factors, the study adopts a controlled experimental approach, employing a scenario-based experiment for individual investors and a field experiment involving financial professionals. The survey instrument is designed around six structured trade-off scenarios that capture variations in environmental emotional attachment, return expectations, and investment horizons. Empirical analysis using panel logistic regression and the Kruskal–Wallis test reveals that sustainable return emerges as the dominant determinant of green investment decisions. The findings indicate that although investors may exhibit emotional concern for environmental issues, such emotional attachment alone is insufficient to motivate green investment behavior. Ultimately, investment decisions are primarily guided by expected financial returns rather than environmental emotional connectedness.