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While there is ample evidence that non-financial firms’ financial performance and social and environmental performance are related, evidence for the banking sector remains limited and inconclusive. This paper examines the impact of access to finance and environmental financing on the financial performance of the banking sector globally. Based on cross-sectional linear regressions and non-linear threshold regressions of 713 banks from 75 countries over the period 2013-2015, we find that access to finance has significantly positive effects on banks’ financial performance in most estimation models controlling for both bank-specific and macroeconomic variables. The positive impact on financial performance is channeled through loan growth and management quality. We find that for banks with total assets less than USD 2 billion, access to finance has a significantly positive impact on return to equity. The paper concludes by discussing policy implications.

Sourced through Scoop.it from: www.inceif.org

#Sustainability #FinancialPerformance

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Because it lacks the self-serving undercurrents associated with other types of marketing, sustainability thought leadership is one of the most effective tools for building trust among stakeholders while establishing your brand as an industry authority.

Sourced through Scoop.it from: sustainablebrands.com

#ThoughtLeadership #Sustainability

 

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