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Sustainability reporting in banking and financial services sector: a regional analysis

Author

Listed:
  • Amina Mohamed Buallay
  • Meera Al Marri
  • Nohade Nasrallah
  • Allam Hamdan
  • Elisabetta Barone
  • Qasim Zureigat

Abstract

This study investigates the relationship between the level of sustainability reporting and banks and financial services’ performance (operational, financial and market) across seven different regions (Asia, Europe, Mena, Africa, North and South America). Using data culled from 4458 observations from 60 different countries for 10 years (2008–2017), we investigate the effect of the Environment, Social and Governance score (ESG) and the three pillars on banks’ performance [Return on Assets (ROA), Return on Equity (ROE) and Tobin’s Q (TQ)]. We also control for bank-specific, macroeconomic and governance effects. The findings pinpoint a negative relationship between ESG on one hand and operational performance (ROA), financial performance (ROE) and market performance (TQ) on the other hand. From regional and pillar perspectives, the performance is differently affected following ESG, pillar and region perspectives. The novelty of this paper lies in the inclusion of different political and economic contexts. Our findings have significant theoretical implications for policy makers and academics at the international level. Banks and financial services sectors’ management lacunae manifest in terms of the weak nexus between ESG, pillars and banks and financial services’ performance.

Suggested Citation

  • Amina Mohamed Buallay & Meera Al Marri & Nohade Nasrallah & Allam Hamdan & Elisabetta Barone & Qasim Zureigat, 2023. "Sustainability reporting in banking and financial services sector: a regional analysis," Journal of Sustainable Finance & Investment, Taylor & Francis Journals, vol. 13(1), pages 776-801, January.
    • Handle: RePEc:taf:jsustf:v:13:y:2023:i:1:p:776-801
    DOI: 10.1080/20430795.2021.1978919
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    Cited by:

    1. V. Veeravel & E. K. S. Sadharma & Bandi Kamaiah, 2024. "Do ESG disclosures lead to superior firm performance? A method of moments panel quantile regression approach," Corporate Social Responsibility and Environmental Management, John Wiley & Sons, vol. 31(1), pages 741-754, January.

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