The ESG Framework in the Banking Sector

Elisa Menicucci ()
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Elisa Menicucci: University of Roma Tre

Chapter Chapter 3 in ESG Integration in the Banking Sector, 2025, pp 27-51 from Springer

Abstract: Abstract The banking sector is increasingly aware of the need to integrate ESG factors into corporate strategies and business. In this context, banks must assess their strategies concerning ESG issues and their impact on revenues and risk in the perspective of sustainable finance. This chapter focuses on how banks can incorporate ESG themes into decision-making. In particular, the analysis highlights the steps to take in developing and implementing ESG approaches for investment and credit strategies and client engagement. The general purpose of the chapter is to clarify ESG concepts from a strategic perspective and to enable the assimilation of the upcoming regulation in this regard into the bank’s value creation model. A step-by-step ESG integration process involves identifying relevant ESG issues, integrating ESG into decision-making, setting targets and goals, assessing current ESG performance, engaging with stakeholders, and measuring and reporting ESG progresses. Since the stakeholder model represents an emerging framework for the strategic vision of a bank, ESG metrics can be used to assess and measure bank performance and its relative positioning within a broader set of bank stakeholders. Hence, the chapter illustrates the interconnections between ESG strategy, the stakeholder model, and the creation of bank value; in doing this we provide a framework for understanding what ESG means for key areas of value creation across a bank.

Keywords: ESG framework; ESG strategy; European banking sector; ESG challenges (search for similar items in EconPapers)
Date: 2025
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Persistent link: https://EconPapers.repec.org/RePEc:spr:sprchp:978-3-031-81677-2_3

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DOI: 10.1007/978-3-031-81677-2_3

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