The Impact of Corporate Finance on Sustainability Dimensions in KSA

This research paper critically examines the interaction between financial structures and sustainability ‎dimensions in banks in the Eastern Province of Saudi Arabia. The study posits that a bank's financial ‎structure, specifically its mix of debt and equity financing, fundamentally determines its long-term ‎sustainability. The study explores the various funding sources available to bank managers and the ‎economic, environmental, and social sustainability dimensions. Using a descriptive analytical approach, ‎the research collected data via questionnaires from administrators, economists, and accountants in Saudi ‎banks and analysed them using partial least squares structural equation modelling (PLS-SEM). The ‎empirical results reveal a different picture: equity financing positively impacts both economic and ‎environmental and social sustainability. Conversely, debt financing positively impacts economic, ‎environmental, and social sustainability. These insights provide valuable guidance for bank managers, ‎enabling them to make informed financing decisions that optimize resource allocation and enhance the ‎long-term success of banks in the unique Saudi context‎.