Can Green Accounting Finance Promote Energy Resilience: Fresh Insights from New Estimation

Abstract

Green accounting financing (GAF) is crucial for restructuring energy use, change, and efficiency. Few studies look at finance’s role in facilitating energy transition despite the paucity of investigation on how GAF impacts energy safety. This study set out to analyse the impact of green accounting finance (GAF) on a nation’s energy security (ES). By examining the nexus between GAF and ES, we investigated a sample of 66 nations from 2000 to 2023. Utilising Panel-Corrected Standard Errors (PCSE) and Feasible Generalized Least Squares (FGLS) and incorporating four explanatory variables, the study has found that green accounting finance significantly improves energy security. The Autoregressive Distributed Lag (ARDL) method was further implemented to understand both the long-run and short-run impacts on energy security. The findings of this method indicate that the influence of green accounting finance persists in the long horizon, highlighting the importance of focusing on green accounting finance initiatives. More importantly, maintaining GAF depends heavily on institutional quality. We test our hypothesis by combining green accounting finance variables with those that represent institutional excellence. The impacts of green accounting finance become more pronounced in countries with well-designed institutional systems. Our findings indicate that promoting green accounting finance is essential for countries to achieve and maintain energy security.