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The Disconnect between Syndicated Lending Activities and ESG Determinants in Banks’ Executive Compensation

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  • Anna-Maria Isabel Maurer

Abstract

Using banks’ implementation of ESG metrics in variable executive compensation and data on syndicated lending, this paper provides first evidence that banks who implement ESG KPIs in variable executive compensation do not alter their lending activities towards brown or fossil companies. I additionally find, that banks which implement such incentive structures lend more to privately held brown firms and less to highly-emitting public firms. These findings question the effectiveness of ESG metrics in banks’ variable executive compensation.  JEL classification numbers: G21, M12, M14, Q50.

Suggested Citation

  • Anna-Maria Isabel Maurer, 2025. "The Disconnect between Syndicated Lending Activities and ESG Determinants in Banks’ Executive Compensation," Journal of Applied Finance & Banking, SCIENPRESS Ltd, vol. 15(3), pages 1-2.
    • Handle: RePEc:spt:apfiba:v:15:y:2025:i:3:f:15_3_2
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    More about this item

    Keywords

    ESG; banking; syndicated loans; corporate governance; executive compensation.;
    All these keywords.

    JEL classification:

    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • M12 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Personnel Management; Executives; Executive Compensation
    • M14 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - Business Administration - - - Corporate Culture; Diversity; Social Responsibility
    • Q50 - Agricultural and Natural Resource Economics; Environmental and Ecological Economics - - Environmental Economics - - - General

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