Corporate social responsibility and bank risk

Neitzert, Florian; Petras, Matthias

doi:10.1007/s11573-021-01069-2

Cited by 44 publications

(38 citation statements)

References 64 publications

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“…, 2011; John et al. , 2008; Neitzert and Petras, 2022). In this study, we adopted the indexes developed by Wind (the market leader in China's financial information services industry, dedicated to providing accurate and real-time information and sophisticated communication platforms for financial professionals).…”

Section: Methodsmentioning

confidence: 99%

Process ambidexterity driven by environmental uncertainty: balancing flexibility and routine

Cadeaux

Luo

et al. 2023

IJOPM

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PurposeThis study aims to extend ambidexterity theory from the perspective of organisational learning and examine how process ambidexterity, which comprises operational flexibility and operational routine, responds to environmental uncertainty and ultimately reduces organisational risks.Design/methodology/approachThis study tests the hypotheses by analysing 464 annual reports of 115 listed companies in the Chinese agricultural and food industry using content and secondary data analyses. Four case studies are also provided.FindingsThe results show that (1) environmental uncertainty has a positive effect on either operational flexibility or operational routine; (2) both operational flexibility and operational routine have negative effects on organisational risks, supporting the view that process ambidexterity mediates the relationship between environmental uncertainty and organisational risks; and (3) organisational slack plays the role of “double-edged sword” by negatively moderating the effect of environmental uncertainty on operational flexibility and positively moderating the effect of environmental uncertainty on operational routine.Originality/valueIn an uncertain environment, companies are exposed to greater risk. This study contributes to risk management in three ways: first, it extends ambidexterity theory to process management and proposes how process ambidexterity balances operational flexibility and routines. Second, it distinguishes between the different conditions under which flexibility or routines are superior. Third, it explains the mechanisms related to how organisations can resolve environmental uncertainty into risk through process ambidexterity.

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Section: Methodsmentioning

confidence: 99%

Process ambidexterity driven by environmental uncertainty: balancing flexibility and routine

Cadeaux

Luo

et al. 2023

IJOPM

View full text Add to dashboard Cite

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“…However, CEOs seem to underestimate risk from a risk management perspective when implementing their banking strategies and policies (Attig, 2021;Jilani and Chouaibi, 2021;Neitzert and Petras, 2022). CEOs are reluctant to employ external financing because of their bias, which causes them to misjudge the value of their bank.…”

Section: 23mentioning

confidence: 99%

“…Stakeholders other than investors may encourage CEOs to reduce risk-taking to a level that is closer to the optimum by exercising their authority to restrict access to resources, whereas stakeholder investment may necessitate a shift toward riskier investments. CEO seems to underestimate the risk from a risk management perspective when implementing their banking strategies and policies (Neitzert and Petras, 2022). Bolton (2013) showed that CSR engagements have a negative impact on bank risk in the financial industry in the USA.…”

Section: 23mentioning

confidence: 99%

CEO behavior and CSR engagement: the moderating role of bank risk-taking

Jilani

Chouaibi

Kouki

2023

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Purpose The main purpose of this paper is to look at the link between chief executive officer (CEO) behavior and corporate social responsibility (CSR) engagement with the moderating role of bank risk-taking behavior. Design/methodology/approach Based on a 13-year data set (2007–2019), the authors applied the feasible generalized least squares with panel data to test the hypotheses. Findings The findings reveal a positive and significant link between CEO behavior and CSR engagement. Based on these findings, it can be argued that the characteristics of the CEO of the banks would improve the CSR strategies. Furthermore, the study suggests a moderating effect of bank risk-taking in the link between psychological bias and corporate social responsibility engagement (CSR engagement). Practical implications As CEO behavioral characteristics are essential to understanding CSR practice, boards of directors should consider the behavioral traits of dominant and overconfident CEOs while designing CSR practices. Social implications If the bank behaves in a socially responsible manner, direct and indirect stakeholders may be able to evaluate the level of risk-taking in more detail. Originality/value This research highlights the importance of CEO behavior characteristics for CSR, which is a crucial application that supports the upper echelons theory; and fills a gap in literature research. It is one of the few studies examining the interaction between risk-taking, CEO behavior and CSR engagement.

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“…In Finger et al ( 2018 )’s study of the effect of the equatorial principle on the business performance of banks, the authors note that for banks in developing nations, adhering to the equatorial principle is a long-term strategic decision. In terms of social responsibility (S), the fulfillment of social responsibility can enhance the reputation of banks, assist them in enhancing their asset quality, and reduce the risk effect of banks on an aggregate level (Neitzert and Petras 2022 ; Shen et al 2016 ). In terms of corporate governance (G), research focuses primarily on the influence of executive characteristics on bank performance (Luh Peter et al 2022 ; Saerang et al 2018 ; Skała and Weill 2018 ), commercial bank credit risk management (Chernobai et al 2021 ; Ratnovski 2013 ; Santomero 1997 ), and bank profitability (Abbas et al 2019 ; Omankhanlen et al 2021 ).…”

Section: Literature Reviewmentioning

confidence: 99%

Environmental, social, and governance (ESG) and market efficiency of China’s commercial banks under market competition

Sun

Liu

et al. 2022

Environ Sci Pollut Res

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As the leading financial institutions in China, it is crucial for commercial banks to pay attention to environmental protection (E), social responsibility (S), and corporate governance (G) in order to enhance operational efficiency and to advance the high-quality development of the country’s social economy. This research explores the market share of banks as exogenous variables in the profit stage and the market and sustainability stage to investigate the efficiency of 20 listed banks in China over 2016–2020 and innovatively incorporates indicators such as green credit, social giving, executive compensation, and ESG score into the meta-dynamic two-stage SBM under the exogenous variable DEA model. The results demonstrate the following. (1) By integrating market share as an exogenous variable in the model, the efficiency estimate is more precise. (2) In overall, UCBs are the most efficient type of banks, JSCBs are the second, SOCBs are the least efficient. All three types of banks are more efficient in profit stage versus the market and sustainability stage, JSCBs perform best in the profit stage, where SOCBs perform best in the market and sustainability stage. The three different bank types’ TGR performance is comparable to their efficiency value performance. (3) SOCBs lead in ESG investment and have the best ESG performance due to their distinct state-owned background. With their ongoing dedication to profit maximization and disregard for social responsibility and sustainable development, JSCBs have the worst ESG performance. (4) Policy recommendations are made based on the study’s findings for commercial banks, stakeholders, and regulators to support ESG investment and to bring about long-term sustainable development. Finally, as ESG develops in China, future research can consider longer time scales and larger perspectives to investigate the sustainability efficiency of commercial banks themselves, as well as their role in the local economy and industrial transformation.

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Corporate social responsibility and bank risk

Cited by 44 publications

References 64 publications

Process ambidexterity driven by environmental uncertainty: balancing flexibility and routine

Process ambidexterity driven by environmental uncertainty: balancing flexibility and routine

CEO behavior and CSR engagement: the moderating role of bank risk-taking

Environmental, social, and governance (ESG) and market efficiency of China’s commercial banks under market competition

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