Islamic banking institutions conduct their business based on Sharia principles. Assessing the performance of Islamic banks is crucial, especially as this sector’s role in global finance continues to grow. Green Banking Practices, Islamic Corporate Governance, and Environmental Performance represent three core pillars that complement each other in creating sustainable value. Green Banking focuses on implementing environmentally friendly operational activities, Islamic Corporate Governance ensures business ethics align with Sharia principles, and Environmental Performance demonstrates a bank’s commitment to environmental responsibility. This study aims to analyze the impact of Green Banking Practices, Islamic Corporate Governance, and Environmental Performance on the financial performance (measured by Return on Assets or ROA) of Islamic banks in Asia. Given the increasing focus on sustainability and Sharia principles, this study utilizes data from the annual reports of Islamic banks across Asia published in 2023. Using multiple linear regression analysis, the findings indicate that only Environmental Performance has a significant effect on ROA, while Green Banking Practices and Islamic Corporate Governance do not have a substantial impact on financial performance. These findings suggest that although Green Banking Practices and Islamic Corporate Governance align with sustainability and Sharia ethics, their financial benefits may not be immediately evident in the short term. However, strong Environmental Performance has proven to provide a competitive advantage, potentially enhancing a bank’s reputation and attracting environmentally conscious investors. This study recommends that Islamic banks continue to strengthen Green Banking Practices and enhance Sharia-compliant governance as a commitment to Sharia principles and sustainability. For policymakers, it is essential to promote uniform standards for Islamic Corporate Governance across regions to ensure consistent implementation. Further studies are encouraged to explore the long-term effects of these practices and to consider other financial performance variables to provide a more comprehensive understanding of their impact.