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Green Microfinance: Characteristics of Microfinance Institutions Involved in Environmental Management

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  • Marion Allet

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  • Marek Hudon

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Abstract

In recent years, development practice has seen that microfinance institutions (MFIs) are starting to consider their environmental bottom line in addition to their financial and social objectives. Yet, little is known about the characteristics of institutions involved in environmental management. This paper empirically identifies the characteristics of these MFIs for the first time using a sample of 160 microfinance institutions worldwide. Basing our analysis on various econometric tests, we find that larger MFIs and MFIs registered as banks tend to perform better in environmental policy and environmental risk assessment. Furthermore, more mature MFIs tend to have better environmental performances, in particular in providing green microcredit and environmental non-financial services. On the other hand, financial performance is not significantly related to environmental performance, suggesting that ‘green’ MFIs are not more or less profitable than other microfinance institutions. Copyright Springer Science+Business Media Dordrecht 2015

Suggested Citation

  • Marion Allet & Marek Hudon, 2015. "Green Microfinance: Characteristics of Microfinance Institutions Involved in Environmental Management," Journal of Business Ethics, Springer, vol. 126(3), pages 395-414, February.
  • Handle: RePEc:kap:jbuset:v:126:y:2015:i:3:p:395-414
    DOI: 10.1007/s10551-013-1942-5
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    References listed on IDEAS

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    Citations

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    Cited by:

    1. Davide Forcella & Marek Hudon, 2016. "Green Microfinance in Europe," Journal of Business Ethics, Springer, vol. 135(3), pages 445-459, May.
    2. Simon Cornée & Ariane Szafarz, 2014. "Vive la Différence: Social Banks and Reciprocity in the Credit Market," Post-Print CEB, ULB -- Universite Libre de Bruxelles, vol. 125(3), pages 361-380.
    3. Lauren Kleynjans & Marek Hudon, 2016. "A Study of Codes of Ethics for Mexican Microfinance Institutions," Journal of Business Ethics, Springer, vol. 134(3), pages 397-412, March.
    4. Labie, Marc & Méon, Pierre-Guillaume & Mersland, Roy & Szafarz, Ariane, 2015. "Discrimination by microcredit officers: Theory and evidence on disability in Uganda," The Quarterly Review of Economics and Finance, Elsevier, vol. 58(C), pages 44-55.
    5. Marion Allet, 2014. "Why Do Microfinance Institutions Go Green? An Exploratory Study," Journal of Business Ethics, Springer, vol. 122(3), pages 405-424, July.
    6. repec:kap:jbuset:v:143:y:2017:i:3:d:10.1007_s10551-015-2811-1 is not listed on IDEAS
    7. Moser, Rafael Magnus Barbosa & Gonzalez, Lauro, 2016. "Green microfiance: a new frontier to inclusive financial service," RAE - Revista de Administração de Empresas, FGV-EAESP Escola de Administração de Empresas de São Paulo (Brazil), vol. 56(2), March.
    8. repec:eco:journ2:2017-03-09 is not listed on IDEAS
    9. Rafael Moser & Davide Forcella & Lauro Emilio Gonzales Farias, 2016. "Microfinance and climate change: threats and opportunities, the case of Brazil’s largest rural MFIs, Agroamigo and Cresol," Working Papers CEB 16-010, ULB -- Universite Libre de Bruxelles.
    10. Moser, Rafael Magnus Barbosa & Gonzalez, Lauro, 2015. "Microfinanças e impactos das mudanças climáticas: o caso do Agroamigo no Brasil," RAE - Revista de Administração de Empresas, FGV-EAESP Escola de Administração de Empresas de São Paulo (Brazil), vol. 55(4), July.

    More about this item

    Keywords

    Environment; Microfinance; Microcredit; Corporate social responsibility; Size; Financial performance;

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • D20 - Microeconomics - - Production and Organizations - - - General
    • Q01 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - General - - - Sustainable Development
    • Q56 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - Environment and Development; Environment and Trade; Sustainability; Environmental Accounts and Accounting; Environmental Equity; Population Growth

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