65 Vol. 7, Issue 1 ISSN 2414-2336 (Print), ISSN 2523-2525 (Online) THE IMPACT OF BEHAVIORAL FACTORS ON ENVIRONMENTAL ISSUES REGARDING INDIVIDUAL INVESTOR’S DECISION MAKING: EMPIRICAL EVIDENCE FROM PAKISTAN’S STOCK MARKET Samina Rooh, Lecturer/Ph.D. Scholar, University of Buner, Buner, Pakistan. Email: samina.ali.bangash@gmail.com Arif Hussain, Assistant Professor, Abdul Wali Khan University Mardan, Pakistan. Email: arifhussain@awkum.edu.pk Muhammad Zahid, Associate Professor, City University of Science and IT, Peshawar. Email: zahid@cusit.edu.pk Abstract. The behavioural biases impact the decision-making of individual investor in the stock market, hence, modern finance theories presumed that investor does not make a rational decision. This research paper aims to examine the impact of behavioral factors on environmental issues regarding individual investor’s decision-making in the Stock Market of Pakistan. The data was collected from five provinces of Pakistan through adapted questionnaires; a sample size of 421 individual investors of the Pakistan stock market. This study applied the Structural Equation Model (SEM) using SmartPLS to analyze the influence of individual investor’s behavioural factors on environmental issues. This study finding showed that overconfi- dence, loss aversion, mental accounting, and herding biases of individual investors positively affect investment decisions on environmental issues. This study attempts to fulfil the gap by analyzing behavioral factors and environmental issues in the Pakistan stock market. However, the current study contributes to the existing literature on behavioral finance and environmental issues in the Pakistan stock market. Furthermore, the current study will be useful for financial professionals, regulatory authorities, or investment advisors, academia as well as practitioners. Keywords: Overconfidence, Loss aversion, Mental Accounting, Herding, and Environmental issues. 1. Introduction The corporate world has faced drastic changes in the last few decades mainly because of the Global Financial Crisis which signified the interconnectivity of the world financial system (Bancel & Mittoo, 2012). This event was primarily Received 19 April 2021 Accepted 04 June 2021