How Does Green Finance Ensure the Attainment of <scp>SDG</scp> 2? Insights From Developing Nations Using Moderated Mediation Framework

ABSTRACT Ensuring food security (FS) remains a persistent challenge for developing countries amid climate risks, energy constraints, and institutional weaknesses, making green finance (GF) a potentially critical policy instrument. This study examines the mechanisms through which GF influences FS by considering the mediating roles of electricity access (EA) and per capita GDP (PGDP), and the moderating role of governance quality (GQ). Using a panel dataset of 68 developing countries covering the period 2001–2022, the analysis applies a two‐stage moderated mediation framework within a fixed‐effects panel setting, with mediation and moderated mediation effects evaluated using bootstrapped confidence intervals. The results indicate that GF has a statistically significant positive effect on FS both directly and indirectly. EA acts as a partial mediator, suggesting that improvements in energy infrastructure enhance food availability and distribution while a direct effect of green finance on food security persists. In contrast, PGDP functions as a complete mediator, implying that economic growth represents the primary pathway through which GF translates into improved FS outcomes. Furthermore, GQ significantly moderates both mediation channels, amplifying the impact of GF on EA and PGDP and thereby strengthening its overall effect on FS. These findings contribute to the sustainable development and institutional economics literature by demonstrating that the effectiveness of green finance depends critically on institutional quality. From a policy perspective, the study highlights the importance of coordinated financial, infrastructural, and governance reforms to harness GF as an effective tool for improving FS and advancing Sustainable Development Goal 2 (Zero Hunger).