How sustainable banking fosters the SDG 10 in weak institutional environments

F. Úbeda, F.J. Forcadell, E. Aracil, A. Méndez

Journal of Business Research Vol. 146, pp. 277 - 287

Resumen:

The role of the financial sector is central in reducing income inequality – the goal of SDG 10 – by facilitating economic opportunities. However, institutional weaknesses may also undermine this effect. We argue that sustainable banking generates bidirectional trust to overcome institutional weaknesses, particularly the weak rule of law. Empirical evidence from 46 countries aggregating data of 1060 banks over 2010–2017 shows that sustainable banking lessens income inequality in weak rule of law settings. The results are robust after including the effects of bank digitalisation. This study has important implications for sustainable banking expansion into weak institutional environments and demonstrates banks’ efforts in their commitment to reducing inequality.

Resumen divulgativo:

La banca sostenible fomenta los criterios ESG al asignar recursos, contribuyendo al ODS10 (Reducir la desigualdad). Sin embargo, el entorno institucional afecta dicho potencial. Analizamos 1060 bancos concluyendo que la banca sostenible reduce la desigualdad solo ante cierta calidad institucional. 

Palabras Clave: Sustainable Development Goals; Inequality; Institutions; Rule of law; Banks; ESG

Índice de impacto JCR y cuartil WoS: 11,300 - Q1 (2022)

Referencia DOI: https://doi.org/10.1016/j.jbusres.2022.03.065

Publicado en papel: Julio 2022.

Publicado on-line: Abril 2022.

Cita:
F. Úbeda, F.J. Forcadell, E. Aracil, A. Méndez, How sustainable banking fosters the SDG 10 in weak institutional environments. Journal of Business Research. Vol. 146, pp. 277 - 287, Julio 2022. [Online: Abril 2022]