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Green Microfinance in Europe

Author

Listed:
  • Davide Forcella

    () (Université Libre de Bruxelles (ULB))

  • Marek Hudon

    () (Université Libre de Bruxelles (ULB))

Abstract

Microfinance institutions (MFIs) are alternative financial providers offering financial services to people typically excluded from the standard banking sector. While most MFIs are active in developing countries, there is also a young and developing microfinance sector in Europe; however, very little literature exists on this MFI segment. In this paper, we analyze the environmental performance of 58 European MFIs. Our results suggest that the size of the MFI, investor concern for environmental performance and, to a lesser extent, donor interest, are closely related to the institution’s environmental performance. Moreover, providing loans larger than microcredits is linked to better environmental performance. This could suggest that the additional revenues generated from these loans, also called cross-subsidies, could help MFIs to strengthen their environmental bottom line. Finally, no evidence suggests that profit status explains environmental performance.

Suggested Citation

  • Davide Forcella & Marek Hudon, 2016. "Green Microfinance in Europe," Journal of Business Ethics, Springer, vol. 135(3), pages 445-459, May.
  • Handle: RePEc:kap:jbuset:v:135:y:2016:i:3:d:10.1007_s10551-014-2452-9
    DOI: 10.1007/s10551-014-2452-9
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    References listed on IDEAS

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    Cited by:

    1. Wei Xu & Hongyong Fu & Huanpeng Liu, 2019. "Evaluating the Sustainability of Microfinance Institutions Considering Macro-Environmental Factors: A Cross-Country Study," Sustainability, MDPI, Open Access Journal, vol. 11(21), pages 1-22, October.
    2. Simon Zaby, 2019. "Science Mapping of the Global Knowledge Base on Microfinance: Influential Authors and Documents, 1989–2019," Sustainability, MDPI, Open Access Journal, vol. 11(14), pages 1-21, July.
    3. Niels Hermes & Marek Hudon, 2018. "Determinants Of The Performance Of Microfinance Institutions: A Systematic Review," Journal of Economic Surveys, Wiley Blackwell, vol. 32(5), pages 1483-1513, December.
    4. Marek Hudon & Marc Labie & Patrick Reichert, 2020. "What is a Fair Level of Profit for Social Enterprise? Insights from Microfinance," Journal of Business Ethics, Springer, vol. 162(3), pages 627-644, March.
    5. Hermes, Cornelis & Hudon, M., 2018. "Determinants of the Performance of Microfinance Institutions: A Systematic Review," Research Report 2018008, University of Groningen, Research Institute SOM (Systems, Organisations and Management).

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