Title

How CEO Competitiveness is related to Firm's economic growth. The Role of Green
Finance

1
Abstract
The purpose of this study is to look into how a CEO's traits affect a company's financial
performance. It specifically looks into the role that green finance plays in mediating the
relationship between CEO traits and business financial success. This study is distinctive
because it offers unique perspective on how a CEO's qualities may affect financial
performance. We make use of secondary data from panel data regression-analyzed annual
and sustainability reports from banks. The findings show that while CEO tenure and CEO
duality have no impact on a bank's economic success, CEO education level has a beneficial
impact on the bank's environmental performance. This study concludes that green financing
plays a major mediating positive influence. Our research highlights the crucial influence the
CEO plays in launching banks' environmental initiatives. The CEO's choice to implement
environmental practices that improve environmental performance is critical. The empirical
results would give shareholders and businesses a foundation to identify factors to take into
account when choosing CEOs and defining their responsibilities.

Keywords: Green Finance, CEO characteristics, financial performance, economic growth

2
Introduction
The necessity of having great leadership is widely accepted across the board in all different
types and sizes of businesses. Increased market competitors, technology developments,
volatility in inflation and interest rates, changing exchange rates, shifting tax laws, and
environmental issues are just a few factors that make today's corporate world so dynamic.
This makes the job of top management, especially CEOs, in steering the organization as a
whole vital. Other aspects that make today's corporate world so dynamic include increased
market competition, technical changes, inflation and interest rates volatility, fluctuating
exchange rates, and environmental difficulties (Kaur and Singh, 2019). Just few examples
(Fatma et al., 2021, Hrazdil et al., 2021). Rigolini et al. (2021) say that the chief executive
officer (CEO) is responsible for overseeing the firm's day-to-day operations, formulating the
organization's long-term strategies, and reviewing the effectiveness with which those
resources are being utilized. In this way, "the lever of power is solely concentrated in the
hands of the CEO", along with possibly even the liabilities, to decide the direction of the
company (Debrulle et al., 2021).
Researchers and other professionals are becoming increasingly interested in how chief
executive officers (CEOs) shape the companies they run. Ahn et al. (2017) say that CEOs can
greatly affect how their companies are run if they are open and honest about their values.
CEOs leave traces of their beliefs on their companies through their decisions about how to do
things. Values are what a person thinks is right and wrong to do in a certain situation. Also,
García Blandón et al. (2019) say that executives' decisions are affected by their personality
and past experiences and that they choose organizational approaches that fit their managerial
schemas and preferences. In order to do this, the strategic choice theory says that the
perspectives, psychology, and experiences of the organization's key actors play a role in
forming its overall strategies. This is because the evaluations made by the people in charge
are used to make management decisions. Capital budgeting procedures, business risk-taking,
and investment decisions are all instances of strategic decisions and actions that are
significantly influenced by the CEO's values (Kaur and Singh, 2018).
In a similar way, the upper echelons theory state that the backgrounds, values, and
personalities of decision-makers have a big effect on how well businesses work because they
"are the mirror image of top management"(Abatecola and Cristofaro, 2020). Because CEOs
are important members of the top management team and make important decisions, their
strategic decisions and actions greatly affect the organization's results and structure. These
choices and behaviors ultimately reflect the CEO's character. Moreover, experts like Chen et
3
al. (2019) say that the efforts and leadership of senior executives have little to no effect on
how a business does. Instead, they say, business results depend on factors that are unique to
the company and the industry. Also, organizational results are not based on top executives'
work or their functional expertise. Instead, they are based on environmental factors and
industry trends. But it's important to remember that contextual variables, like those unique to
an industry or firm, technological, and environmental factors, are tangential and don't have
much of an effect on how a business does (Teece, 2019). Since managers decide which
strategic actions to take and how to use them, these variables do not make decisions or take
action. Managers differ in many ways, such as their education, age, experience, personality,
and so on. So, a CEO's mental and visible traits do affect his or her decisions and behavior,
which in turn affects the results of the business. This view is supported by studies that have
been done in the past. For example, Wang et al. (2021) find that CEO characteristics like
tenure, ownership, and affiliation have a bigger effect on corporate cash holdings in Korea
than demographic and job-specific characteristics. Kaur and Singh (2018) study of the
relationship between executive traits and a company's value found that the CEO's tenure and
political connections have a big effect on the value of a company in China. Recent research
by Gherghina et al. (2020) suggests that companies in Indonesia might choose experienced,
smart, and aggressive CEOs to improve their reputation and performance. Rigolini et al.
(2021) say that a CEO's demographics, experience, and salary affect how innovative a
company is and how much its stock goes up. Chi and Li (2017) used a sample of publicly
traded North American hospitality companies to find that gender, age, and experience of
CEOs continue to have a big effect on the financial success of a company, as shown by
financial ratios. Several other studies have come to the same conclusions, which back up the
upper echelons theory. Recent research also show that understanding a CEO's natural
personality traits, such as confidence, narcissism, risk-tolerance, military background, and
political ideology (McCarthy et al., 2017).
Researchers have found that CEOs of all different sizes of companies can benefit from the
same kinds of leadership skills (Emestine and Setyaningrum, 2019). Ahmad et al. (2022) say
that the CEO's leadership style may affect the firm's long-term growth and reputation because
the CEO's strategic decisions directly affect the company's financial performance. We don't
know of any research that has looked at the long-term aspects of a business, like how it
creates value and stays in business. This seems to be what most studies have looked at. This
is a very small picture of what's going on. Also, sustainable growth seems to have gotten the
attention that traditional growth ideas don't have right now, and it's becoming more and more

4
of a concern for the business world as well (Harymawan et al., 2019). If the company only
focuses on its growth, it might be able to reach its short-term goals, but it won't be able to
reach its long-term goal of "creating value". Kaur and Singh (2018) found that when a
business grows faster than it can grow in a sustainable way, value creation peaks and then
drops quickly. Managers care a lot about building and keeping a good reputation in the public
eye. They did this because a company's reputation is a valuable intangible asset in today's
fast-paced and very competitive business world. This understanding ensures that the company
will succeed in the long run. Given how important this job is, it's not clear if the CEO's
personality affects the company's long-term success and brand recognition (Heyden et al.,
2017). Also, in the Pakistani market, only a few studies such as (McCarthy et al., 2017,
Duppati et al., 2020) show that executive traits have a big effect on how well a company
does.
Green finance initiatives are gaining ground across Asia in a number of ways, including
standards for green bonds, incentive schemes for green bonds, and sovereign green bonds.
Green bonds, which are used to pay for low-carbon projects, have become more popular in
Asia and other places in recent years (Braun, 2017). In 2012, the green bond market was
worth $2.8 billion. In 2017, it was worth $136 billion. Green bonds were first issued in 2007
and 2008 by European governmental and non - governmental investors. China began issuing
green bonds in 2015 and is now the world's largest issuer. Green financing, and specifically
green financing tools, can influence environmental efficiency, the rate at which GDP grows
in green infrastructure systems, and the sustainability of both economic and environmental
growth (Wang et al., 2019). In particular, the World Bank conference in 2012 showed that
green growth helps in many ways, such as improving production function, increasing
production efficiency toward the production frontier line, boosting the economy in hard
times, and coming up with new ideas through new techniques. This has shown that there is a
strong link between green development and the green energy economy, but there is still a lot
more research that needs to be done to prove this link (Zhou et al., 2022). Because of this,
sustainable development goals that focus on green growth need green finance to be met.
Inclusive green funding, which helps reduce and adapt to the harmful effects of climate
change, is one way to achieve equitable green growth. In a time of climate change and
uncertainty, financial institutions are required to sell green products in the areas of savings,
credit, insurance, money transfers, and new digital delivery channels. All of these are very
important. In the end, it is the leader's job to ensure that the organization's stated mission and
core goals are met. Whether or not these changes and goals are reached depends on how well

5
a leader can motivate his or her team members to do their best (Davis, 2019). Firm
executives, especially the CEO, can help their companies succeed by showing a number of
traits that have been shown to help businesses do well (Saha et al., 2022). One of the biggest
indicators of a good board of directors is the CEO's character. The leader's personality traits
also greatly impact company strategies, organizational values, and how superiors and
subordinates interact with each other.
This study aims to look at how green financing affects Pakistan and how CEO traits affect
how well a company does financially and economically. Because of this, this study adds
important information to what has already been written. First, most of the research done
before has been on the short-term effects of CEO qualities on the financial performance of a
business (García Blandón et al., 2019, Ou et al., 2018). Within the framework that has
already been set up, this research shows how a CEO's personality affects the company's
image and ability to grow sustainably. Include both short- and long-term goals. Second, it has
been said that not many studies have shown that CEO qualities have a big effect on how well
a company does in the Asian market (Naseem et al., 2019). This study adds to what has
already been written by giving the first-ever empirical data from a developing country like
Pakistan on how the traits of a CEO affect different aspects of a firm, such as economic
growth. Third, most of the past research on how CEO traits affect business results has
focused on either the CEO's traits (Kaur and Singh, 2019). This study adds to the existing
research by giving a complete picture of the CEO's personality, which helps explain financial
success and economic growth. It does this by putting the CEO's personal and job-related traits
under one heading. Fourth, and this may be the most important, the research does a good job
of using a number of different ways to specify and estimate. Fifth, our findings give
policymakers more information they can use to make strict rules about corporate governance
and other best practices. Sixth, the results of this study give shareholders and businesses a
way to figure out what criteria should be used to choose CEOs and what their roles and
responsibilities should be. Last but not least, this research can be a very important tool for
investors and business managers to use when implementing investment policies.
The rest of the paper is organized as follows: The review of existing literature and the
formulation of hypotheses are covered in Section 2. The research approach is explained in
Section 3. Section 4 presents the outcomes of the data analysis and testing of hypothesis.
Section 5 concludes the work.
Theoretical Background

6
The number of academic studies that look at business CEOs has grown a lot in recent years.
As people have become more interested in the top levels of business, the Upper Echelons
theory has grown along with it (Abatecola and Cristofaro, 2020). Hambrick and Mason first
put forward the Upper Echelons theory. It says that "an organization is a reflection of its
senior executives". This theory says that CEO make decisions based on how they see things.
So, these points of view make the most of organizational performance (like profit, growth,
and staying in business) and strategic decision-making (like innovation, diversification,
capital structure, and dividend policy). This idea says that the organizations CEOs lead, their
choices, and the results they get are all shaped by their personalities and experiences (Dubey
et al., 2018). Also, the idea says that things in the social, psychological, and cognitive realms
greatly impact how top executives make decisions.
The agency theory also says there is a link between a CEO's skills and the company's success.
Panda and Leepsa (2017) say that the agency lens is needed to understand how top
management, strategic decisions, and business performance are related. The idea aims to
align the interests of managers and shareholders by setting up a corporate governance
framework with the right incentives and good ways to keep an eye on things. This supports
the idea that agency theory can shed light on the things that influence the decisions and
actions of senior executives, which in turn can affect the bottom line. Shogren et al. (2017)
uses agency theory to argue that the length of time a CEO has been in charge and the fact that
they have more than one job make their authority and power stronger. This may worsen CEO
entrenchment by making it harder for the board to control the CEO. If no one stops them, a
powerful CEO like this will do things that help them at the expense of the company's owners'
financial security. Ultimately, these theories will help us understand the literature on
corporate social responsibility (CSR) and company success (Darayseh and Chazi, 2018).

Literature Review and Hypothesis Development

CEO Education and Economic Growth
Executives with strong educational backgrounds provide a company with considerable human
resources (Elsharkawy et al., 2018). One's level of education can reveal something about their
moral code and intellectual capabilities. A high degree of education is important for boosting
managers' reputations and enabling them to make the best judgments. According to Kaur and
Singh (2018), executives with higher education levels have more complex cognitive systems
that make it easier for them to absorb and accept new concepts. Emestine and Setyaningrum
(2019) provide evidence for this claim, stating that directors with outstanding academic

7
credentials are less risky-averse and more likely to adopt novel concepts, ground-breaking
innovations, and investment opportunities. Furthermore, CEOs with higher educational
backgrounds have more advanced skills, intellectual functioning progress, and a wealth of
knowledge, all of which may influence future organizational effectiveness in the intended
way by promoting more strategic decision and better decision-making. Numerous earlier
empirical research back up this perspective. For instance, McCarthy et al. (2017) found a
favorable correlation between the CEO's educational background and innovation utilizing a
large sample of Chinese companies. CEOs with extensive science degrees are less risk-averse
and more likely to invest in R&D projects, according to Barker III and Mueller's (2002)
observations. ALTUWAIJRI and KALYANARAMAN (2020) has more recently
demonstrated, using a Nigerian sample that businesses with educated CEOs outperform those
without. According to researcher, businesses with CEOs who hold graduate degrees do
significantly better on the stock market (Saidu, 2019). The results are also extremely similar
to those reported by (Aifuwa and Gideon, 2022, Singhal et al., 2021). On the other hand some
researchers (Morresi, 2017, Fujianti, 2018) could not discover any appreciable effects of
CEO education on company performance.
The results of UET are used by several research to pinpoint characteristics of CEOs, such as
training, experience, and functional background that may affect environmental and social
sustainability of corporations. The importance of formal education among the many
management background traits that affect organizational success was underlined in the UET
by (Ghardallou, 2022). In this regard, one's background may be indicative of their level of
environmental consciousness. The awareness of environmental conservation increases with
education level. A previous study found that managers' educational backgrounds have an
impact on their attitudes and worldviews as well as how they make decisions. Due to the
variety of skill sets and knowledge obtained, executive behavior differs depending on
education level. According to Ahmad et al. (2022), discipline, as well as the educational
level, has an effect on CSR performance. On the basis of above discussion, we hypothesize;

H1: CEO education has a significant positive impact on firm economic growth

CEO Tenure
A person's position of authority inside a company is known as their term of office or tenure
(Saidu, 2019). Organizational tenure is regarded, in particular, as a sign of experience in a
specific job within an organization. According to Rigolini et al. (2021), long-tenured CEOs

8
bring to the top management team more stability, efficiency, reduced conflict, and improved
interpersonal communication, which promotes social cohesion and shared social knowledge.
Additionally, they might have developed more solid social and professional ties, which could
be useful in resolving complicated issues related to knowledge and technology as well as
capital accumulation (Kaur and Singh, 2018). Additionally, CEOs with longer tenures are
more likely to make logical decisions than CEOs with shorter tenures since they have more
experience, expertise, and understanding of the business environment and company activities.
According to Emestine and Setyaningrum (2019), CEOs with longer tenures are more likely
to be knowledgeable about the company's resources and operating procedures, making them
better suited to give direction and guidance that could improve corporate performance. On the
other hand, a researcher contend that the longer the CEO's tenure, the more powerful and
unjustified the CEO's influence over the corporate board (Mukherjee and Sen, 2022). Without
limits, a CEO with such influence will engage in self-serving actions that may harm the
principal's financial well-being and, in addition, may negatively impact the company's
performance as a whole.
There is conflicting information regarding the impact of a CEO's term on business
performance. For instance, Cao et al. (2021) demonstrate that the average executive term in
office has a favorable and significant impact on business performance. According to research
the length of the CEO's tenure is related to the success of the company (Dikolli et al., 2014).
According to Khan et al. (2020), business performance, as evaluated by ROE, ROA, and
Tobin's Q, is significantly positively impacted by the CEO's duration in office, which is
consistent with the findings. Mihail et al. (2022) find that CEO tenure positively increases the
business value as assessed by Tobin's Q using a sample of all the listed Bucharest Stock
Exchange companies. But according to Saleh et al. (2020), the length of the CEO's tenure is
linked to poor company performance. Similarly, a researcher discovered that the length of the
CEO's tenure has a considerable detrimental impact on the amount of cash held by the
company (Glowka et al., 2021). Turrent et al. (2022) make the observation that CEO tenure
has a consistent and significant negative effect on dividend distribution using data from four
Latin American nations from 2004 to 2014. However, a researcher found no evidence of a
substantial relationship between the duration of the CEO and corporate performance (Orij et
al., 2021).
We anticipate that, in the context of this study, the benefits of CEO tenure will outweigh any
drawbacks. Therefore, we suggest the following:

9
H2: CEO tenure has a significant positive impact on firm economic growth

CEO Duality
The board control structure's key mechanism is thought to be CEO duality. The term
"duality" refers to the circumstance in which one person holds the positions of both board
chair and CEO (Mubeen et al., 2021). Simply expressed, dual leadership refers to a board
leadership structure in which the CEO holds twin positions: one as the company's CEO and
the other as the board of directors chairman. According to Saidu (2019), a CEO's split
personality is necessary for effective company leadership and control over the management
of the firm's operations. A CEO with consolidated power provides more clarity on the
company's leadership and direction, allowing for more fruitful interactions with third parties.
Additionally, corporations are able to react to outside events more quickly thanks to the
concentration of power these efficient decisions and actions tend to increase competitiveness
and produce higher company performance (Orij et al., 2021). Instead, CEO-chairman duality
reduces board control, which in turn negatively impacts the organization's performance. It is
stated that a CEO who serves in two capacities amasses immense influence; this power is
prone to weaken internal controls and lessen checks and balances, both of which tend to
worsen business performance. Some claim that there is no ideal board leadership structure
because both types of structures could have costs as well as benefits (McCarthy et al., 2017).
A previous empirical study on the relationship between CEO dualism and business success
shows conflicting findings. Examples include the findings of Nuanpradit (2019), indicating
that CEO duality is strongly and favorably related to business performance. On the other side,
CEO duality and business performance in India are not shown to be significantly correlated
by (Herndon, 2020). Hsu et al. (2021) demonstrate, using the Canadian sample, that
combined leadership continues to have a substantial positive correlation with profitability and
the firm's worth. Ali et al. (2022) note that dualism firms are linked to superior performance
using US enterprises as a sample. The findings of numerous additional studies also support
the stewardship idea (Alves, 2020). Wijethilake and Ekanayake (2020) in contrast,
demonstrates that separating the roles of CEO and board chairman increases business
success.
We anticipate that a mixed leadership structure would have an impact on corporate results,
drawing on agency theory. Therefore, we suggest the following:

H3: CEO duality has a significant positive impact on firm’s economic growth.

10
The mediating role of green finance
Struggling resources and environmental harm are also starting to emerge as a result of
society's progress. In certain nations, the ongoing conflict between the objectives of
environmental preservation and economic expansion is partially a confrontation between state
organizations tasked with carrying out these divergent tasks (Lee and Lee, 2022). In addition
to implementing economic transformation and sustainable development, we must create a
low-carbon economy. According to national governments, international organizations,
universities, and civil society, more information is needed not just to help policymakers make
better decisions but also to provide people the "right to know" about how industry and
economic growth affect the environment. Green finance refers to the financial sector's basic
stance on environmental protection, which requires that any potential environmental effects
be taken into account when making investment and financing decisions (Falcone and Sica,
2019).
Recent years have seen a rapid increase in green investment across various industries,
particularly in clean energy, renewable energy, and industrial capacity. The terms "green" and
"finance," which are both contentious topics, are emphasized in this new financial model for
integrating environmental preservation with economic gains (Taghizadeh-Hesary and
Yoshino, 2019). The study concludes that entrepreneurs' technical educational backgrounds,
offline entrepreneurial experiences, and online entrepreneurial experiences all have favorable
effects on internet funding (Sachs et al., 2019). Due to increased understanding, CEOs are
more likely to support policies that prioritize environmental concerns. They acquired more
information about environmental challenges from outside sources, which helped to shape
their personalities into creative leaders who understood the significance of environmental
stewardship (Nawaz et al., 2021). Additionally, it will make them more aggressive in tackling
company problems and obstacles, such as environmental problems. According to Harjoto et
al. (2019), a more diverse board of directors would be better equipped to support the
company's shift in focus to a stakeholder-oriented one, which would improve the company's
performance in the areas of social and environmental responsibility. According to Sumarta et
al. (2021), the level and area of expertise often influence the CEO's decision-making,
particularly when it comes to dealing with environmental issues. The ability of the CEO to
make decisions on environmental challenges, which results in improved environmental
performance, is known as environmental expertise. CEOs with a social sciences and

11
humanities background will increase their organization's care for the environment
(Harymawan et al., 2019).
The ultimate goal of green financing is to help the company develop economicall (Force,
2015). Green finance development and the creation of renewable energy depend on green
bonds, reducing greenhouse gas emissions, and green economic development (Lin et al.,
2014). Businesses are able to satisfy stakeholder demands for the environment and increase
organizational effectiveness to adapt to changes in the external environment, which is
beneficial for enhancing corporate reputation and creating lasting relationships with suppliers
and customers, which in turn improves financial performance. In other words, the
performance of green enterprises is positively impacted by green finance (Dervi et al., 2022).
Numerous researchers confirmed the results. Studies by (Spinaci, 2021, Munitlak-Ivanovic et
al., 2017) concluded that green finance greatly influenced the environment and economy.
Both studies showed that green finance legislation might improve food firms' environmental
performance.

H4: There is significant mediation of green finance in the relationship between CEO
attributes and firm growth

Research Model

CEO Characteristics
Economic
 Education /Financial
 Tenure Performance
 Duality

Green
Finance

Research Methodology

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Our sample is a commercial bank that is traded on the PSX. The database was gathered over
the course of eight years, from 2010 to 2018, to compile the essential information for the
selected organizations, such as financial and CEO-specific features. The aforementioned time
period was selected with the hope of evading the consequences of the 2008-2009 global
financial problems. CEO education, experience, and employment history data were all
retrieved by hand. The CEOs' educational backgrounds were gleaned from their resumes
and/or social media profiles, while the CEOs' lengths of service were obtained from the
company's annual report. Additionally, information regarding CEO dualism was collected
from financial institution websites. Specifically, we employ a kind of sampling called
"purposive sampling" to select our samples. The study's objectives inform the criteria used to
choose the sample. For instance, (a) the bank must be registered with the PSX, and (b) the
bank must make its annual report publicly available. After much deliberation, we settled on a
sample size of 300 observations across 30 commercial banks, resulting in an unbalanced
panel dataset. The data for this article was compiled from the annual reports of Pakistani
banks. Both financial performance variables and the myriad controls over those variables are
included. There are a total of 30 different publicly traded companies that were included in the
final sample, which covers the years 2010-2018. Non-financial businesses and companies
with missing data are not included in this study because they must follow special reporting
requirements.

Data Analysis
This research aims to examine the role of green finance as a mediator between CEO traits and
bank economic growth. A multivariate analysis model is used to analyze the effect of the
independent factors on the dependent variable. The test is carried out using a regression
analysis of data panels. Since we have a set of imbalanced panel data, and since it can
manage unbalanced panel data by ignoring observations with missing values and focusing on
complete case analysis, we have decided to use Statistics Software to carry out panel data
regression analysis.

Result and Discussion

For the data analysis portion, three main variables are first identified: education, tenure, and
duality. The secondary data are taken from different sources, proving that 24% of the samples
gathered include individual from the same background and has an academic background as
the CEO. At the same time, many executives are in senior positions, but they need to have the

13
background of the CEO education. The percentage of such members is about 27.8% to the
secondary data from the reports and the papers. The means of the different parameters were
identified and calculated in excel. The mean of the sustainable growth of the firm is about
0.0632. Other than this, the means of the firm size, leverage, and return on the assets was
calculated and came to be 21.910, 0.564, and 0.0632 means of the TOPI was come to be 35%
and 38%, which is related to the directors of the board. It is included in the independent
variables. By calculations, it is observed that there are many state-owned enterprises, and
about 31% of the CEOs also served as the chairman of their organization.

Sr
Variables Obs Mean Std. Dev. Min Max
no.
1 SGR 300 0.0521 0.102 -0.6632 0.412
2 Academic 300 0.2574 0.532 0 1
3 CorAge 300 17.451 5.9873 0 50
Non
4 300 0.321 0.553 0 1
CEOacademic
5 Size 300 22.45 1.4532 20.22 26.532
6 Lev 300 0.5938 0.312 0.0532 0.3456
7 ROA 300 0.0646 0.0763 -0.54321 0.321
8 Indep 300 0.352 0.0631 0.333 0.62
9 Duality 300 0.311 0.531 0 1
10 Top 1 300 35.92 17.321 9.32 76.32
11 SOE 300 0.846 0.521 0 1
12 Age 300 50.432 7.6621 29 78.64
13 Edu 300 0.632 0.5311 0 1
14 Gender 300 0.9821 0.361 0 1
15 Pay 300 13.863 0.721 0 17.321
16 Financial 300 0.8765 0.321 0 1
17 Overseas 300 0.082 0.294 0 1
18 Military 300 0.02 0.1 0 1

The average age of the CEO from our samples is about 49 years, and from that of the
samples, only 50% have CEO education. We will say that we have a master’s degree. From

14
the whole sample, there are 93.5% of the males. A tiny proportion of CEOs have experience
with this thing. The percentages of CEOs with financial experience (Financial) and CEOs
with international experience (Overseas) are respectively 9.3% and 7.9%. Additionally, only
1% of CEOs have military experience. In conclusion, these variables' values exhibit a
reasonable degree of variation and are comparable to what has been shown in earlier studies.
Sr No Variables Operationalization
1 Dependent Variables
2 Leverage Ratio Ratio of total debt to assets
3 Independent Variables
4 CEO tenure Years during which the CEO retains
his position
5 CEO duality CEO as a chairperson as well
6 CEO education level Education of the CEO whether the
BS, MS or PhD
7 Control Variables
8 Board Size The no of the executives in that
board
9 Board Independence The ratio of the total number of the
directors which are independent to
the directors of the board
10 Growth opportunities Tobin’s Q ratio
11 Firm Size It is measured by the total assets of
that organization
12 Firm age It is the log of firm age
13 Industry It is classified as the SIC coding

The descriptive analysis of the firms is done for the above variables with the help of excel,
and their mean, median, min, max, and standard deviation values were calculated.

Variables Mean Median Max Min SD

Leverage 0.321 0.167 3.165 0.000 0.31541
ratio
CEO tenure 12.54 9.154 56.154 1.065 10.402

15
 CEO duality 0.364 0.000 1.005 0.00 0.5416
CEO 0.654 1.2941 1.002 0.000 0.514
education
level
CEO age 57.415 57.65 89.1541 25.154 10.2548
CEO gender 0.0654 0.000 1.005 0.000 0.199
Board size 10.541 10.114 21.014 4.0051 3.541
Board 0.6214 0.46651 0.6941 0.000 0.1094
independenc
e
Growth 4.1574 3.214 45.125 0.0054 2550.15
opportunities
Firm size 7964.4157 1926.318 351525.14 40.15841 0.70661
Firm age 4.457 4.514 6.154 0.000

It demonstrates that women still encounter particular difficulties as they advance up the
corporate ladder. CEO duality is rare in the sample, with a mean value as low as 0.29,
indicating that Indian companies do not frequently have executives with the titles of CEO and
chairperson. This suggests that, given the advantages of such separation, separating the CEO
and chairman roles in a nation like India is considered a wise decision. Additionally, a
majority of CEOs—about 55%—have postgraduate degrees, demonstrating their professional
sophistication. Panel Regression Results

While moving toward the regression analysis, it does not go through the issue of
multicollinearity, and another heteroscedasticity issue of multicollinearity arises due to the
relationship between two independent variables.

Table shows the results of the multicollinearity test

Sr no Variables VIFs
1 CEO tenure 1.501
2 CEO duality 1.3321
3 CEO educational level 1.064
4 CEO age 1.441

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 5 CEO gender 1.031
6 CEO share ownership 1.14
7 Means VIF 1.084

Panel regression analysis is constructive in that case; the above table shows that CEO tenure
affects the firm's leverage positively as the value of p is greater than that of 0.05.

Table shows the panel diagnostics

Sr no Test Statistics Leverage Ratio

1 F statistics 19.226
2 Breusch–Pagan LM statistics 1846.315
3 Hausman statistics 20.55

As a whole, from the above analysis, we will say that the CEO duality, education level, and
gender have no impact on the leverage corporate, and it came to be consistent with the
literature review. The CEO duality is not significantly related to the leverage ratio. There is
also an insignificant relationship between the CEO's education level and leverage. Due to the
inverse relationship between CEO share ownership and firm leverage, the board of directors
and shareholders must be particularly vigilant in monitoring managers to ensure that they act
in the best interests of shareholders. Our fourth main of this study was to see the mediating
effect of green finance on economic growth. For this purpose, the panel regression analysis
was done. The F-test statistics are used when the value of p is lesser than that of 0.05; it
rejects the null hypothesis. For this purpose, the Hausmann test is used, and its results show
rejecting the null hypothesis. The fixed effect model is used to analyze the relationship
between economic growths by green finance. From the mean value, it is observed that in the
last few years, green finance has positively impacted a firm's performance. It is also observed
that a 0.0736% change in the green growth will cause a 1% change in the firm's performance.
Green finance is a mediator in that process. Risk-taking behavior favoring high company
leverage is vital and should be promoted when making capital structure decisions. This way,
H1 is accepted, while H2 and H3 are rejected. Moreover, H4 is also accepted.

Conclusion

17
The study examines how factors like CEO tenure, dualism, and education affect the banks'
financial ability to develop economically. It specifically attempts to investigate the mediating
function of green finance in the relationship between CEO qualities and company economic
growth. The most exciting thing about our research is that it showed that education for CEOs
had a beneficial effect on the financial performance of banks. Furthermore, the length of the
CEO's employment and their multiple roles have no apparent impact on the financial results
of Pakistani banks. Our results imply that green finance enhances business financial
performance and significantly mediates the association between CEO characteristics and firm
economic growth. Our findings demonstrate how green financing can assist a company in
operating more sustainably. Most organizations can boost their green performance and
revenue by utilizing environmental management strategies (Ahmad et al., 2022). Managers
can use these executive features to their advantage when implementing the study's
suggestions to enhance organizational performance. These findings support the upper
echelons theory and the resource dependence theory by correlating with earlier studies that
found that the CEO's characteristics affect company outcomes and sustainability.
Organizations are more likely to report on sustainability if they have specific executive traits.
Rules that recognize and reward particular attributes in leaders, such as those that mandate
hiring CEOs with advanced degrees, are of utmost significance. It's crucial to support them if
you can because long-serving CEOs are more likely to oversee effective CSR initiatives
(ALTUWAIJRI and KALYANARAMAN, 2020).
The study has limitations because it only looked at a small number of banks. On the other
hand, research that will be done in the future on the role of the CEO in the connection
between CSR and business performance might look at additional CEO characteristics.
Furthermore, because data from companies in various industries were not used, this study
might have drawn incorrect findings. More investigation is required if we are to get a
comprehensive understanding of the relationship between the green financing system and
green enterprises. It is crucial to comprehend how moderators influence this link. Future
research might examine additional variables, including business size, liquidity, leverage, etc.,
but those needed to be more pertinent to the focus of this paper.

18
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