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Financial and environmental performances in the banking industry: A non-linear approach

Author

Listed:
  • Issam Laguir

    () (Montpellier Business School and Montpellier Research in Management)

  • Rebecca Stekelorum

    () (Université de Montpellier)

  • Jamal Elbaz

    () (Ecole Supérieure de Technologie (EST) d'Agadir, Ibn Zohr University)

  • Lamia Laguir

    () (Université Paris Descartes, Sorbonne Paris Cité)

Abstract

The present paper investigates the impact of corporate financial performance (CFP) on corporate environmental performance (CEP) in the banking industry. Based on the data of French banks from 2008 to 2011, our study reveals that the relationship between CFP and CEP is non-monotonic, thus suggesting that bank CEP increases significantly only after a certain threshold of financial resources is reached. Our study provides unique insights into the CFP-CEP relationship in the banking industry and reveals that adequate financial resources needs to be available in order to foster environmental investment and meet the expectations of a range of stakeholders.

Suggested Citation

  • Issam Laguir & Rebecca Stekelorum & Jamal Elbaz & Lamia Laguir, 2017. "Financial and environmental performances in the banking industry: A non-linear approach," Economics Bulletin, AccessEcon, vol. 37(4), pages 2616-2624.
  • Handle: RePEc:ebl:ecbull:eb-17-00402
    as

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    File URL: http://www.accessecon.com/Pubs/EB/2017/Volume37/EB-17-V37-I4-P235.pdf
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    References listed on IDEAS

    as
    1. Earnhart, Dietrich & Lizal, Lubomir, 2006. "Effects of ownership and financial performance on corporate environmental performance," Journal of Comparative Economics, Elsevier, vol. 34(1), pages 111-129, March.
    2. Nollet, Joscha & Filis, George & Mitrokostas, Evangelos, 2016. "Corporate social responsibility and financial performance: A non-linear and disaggregated approach," Economic Modelling, Elsevier, vol. 52(PB), pages 400-407.
    3. Clarkson, Peter M. & Li, Yue & Richardson, Gordon D. & Vasvari, Florin P., 2011. "Does it really pay to be green? Determinants and consequences of proactive environmental strategies," Journal of Accounting and Public Policy, Elsevier, vol. 30(2), pages 122-144, March.
    4. Satoshi Tobe, 2017. "Domestic Credit Growth, International Capital Inflows, and Risk Perception in Global Markets," Economics Bulletin, AccessEcon, vol. 37(2), pages 631-636.
    5. Misani, Nicola & Pogutz, Stefano, 2015. "Unraveling the effects of environmental outcomes and processes on financial performance: A non-linear approach," Ecological Economics, Elsevier, vol. 109(C), pages 150-160.
    6. Lars Hassel & Henrik Nilsson & Siv Nyquist, 2005. "The value relevance of environmental performance," European Accounting Review, Taylor & Francis Journals, vol. 14(1), pages 41-61.
    7. Philipp Schreck, 2011. "Reviewing the Business Case for Corporate Social Responsibility: New Evidence and Analysis," Journal of Business Ethics, Springer, vol. 103(2), pages 167-188, October.
    8. Nicole Darnall & Irene Henriques & Perry Sadorsky, 2010. "Adopting Proactive Environmental Strategy: The Influence of Stakeholders and Firm Size," Journal of Management Studies, Wiley Blackwell, vol. 47(6), pages 1072-1094, September.
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    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    Environmental corporate social responsibility; corporate financial performance; curvilinear CFP–CEP relationship; banks;

    JEL classification:

    • L2 - Industrial Organization - - Firm Objectives, Organization, and Behavior
    • M2 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Economics

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