This study is designed to estimate impact of green banking disclosure, corporate governance mechanism on performance of listed banks in selected SAARC countries including Pakistan, India, Bangladesh, Sri Lanka and Nepal. With the help of STATA 14.2 this study used PCA (Principal Component Analysis) in addition to content analysis to create green banking disclosure index .For this purpose, central bank’s green banking guidelines are summarized into7 categories and 38 items. Dynamic panel data set (2010-2019) is analyzed by applying system GMM step-one method. The relationships among board independence, board size, female director, institutional ownership, green banking and Tobin’s Q (market value) as performance measure is tested. Institutional ownership and board independence has significant negative impact on market value, green banking does not have any significant impact on market value. On average disclosure practices are different in different categories. Effectiveness of central bank guidelines can be identified at regional level. Results are suggestive that corporate governance mechanism restructuring is needed to increase market value of banks in SAARC countries. To the best of author’s knowledge, this is the very first study which methodologically contributes in the field of green banking disclosure as application of PCA and System GMM step-one. Contextually, one of the most affected area facing higher climate change risk as SAARC region of the world is discussed. Theoretically, study contributes in the theory of change, financial intermediation and agency theory.