Investor Behaviour in Green Investments: A Comprehensive Review of Perceptions, Biases, and Decision Processes

Author(s)	Ms. Suma B R, Dr. Shreelatha H R
Country	India
Abstract	The mobilisation of retail capital toward green investments is a critical sustainable finance challenge, as investors underinvest despite stated environmental preferences. This thematic review synthesises 71 works (2015–2025) using a PRISMA-inspired protocol and deductive-inductive analysis grounded in Ajzen's TPB, Kahneman & Tversky's Prospect Theory, Spence's Signalling Theory, Davis's TAM, and UTAUT. Six clusters—perceptions and awareness; cognitive biases; ESG preferences; demographic moderators; greenwashing, policy, and trust; and fintech-driven green investment democratisation—are critically reviewed. Pro-environmental attitudes are necessary but insufficient, mediated by green financial literacy, institutional trust, loss aversion, and greenwashing perception. Ten research gaps, a six-directional agenda, and an integrated framework are advanced.
Keywords	green investment; investor behaviour; behavioural biases; Theory of Planned Behaviour; Prospect Theory; retail investors; sustainable finance; emerging markets
Field	Sociology > Banking / Finance
Published In	Volume 8, Issue 5, September-October 2026
Published On	2026-10-26

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