CSR engagement and market structure: Evidence from listed banks

Forgione, Antonio Fabio; Migliardo, Carlo

doi:10.1016/j.frl.2020.101592

Cited by 25 publications

(8 citation statements)

References 40 publications

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“…In reviewing the literature, we find that the studies on the impact of CSR on performance and risk are abundant for nonfinancial firms, e.g. Sardana et al (2020), Bhattacharyya and Rahman (2019), Forgione and Migliardo (2020) and Ting (2020). Nonetheless, it is interesting to note that very few studies examine the link between CSR and risk in banking industry, even though the financial institutions have increasingly been scrutinized in the aftermath of the global financial crisis.…”

Section: Literature Reviewmentioning

confidence: 99%

The impact of corporate social responsibility on the risk of commercial banks with different levels of financial constraint

Nguyen

Khương

2020

APJBA

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PurposeThis research investigates the link between corporate social responsibility (CSR) activities and bank risk-taking in Vietnam and introduces the constraint factor to see whether this link alters with different levels of constraint.Design/methodology/approachUsing a sample of commercial banks in Vietnam from 2008 to 2017, this study employs two-step system generalized method of moments (Sys GMM) with a finite sample correction mechanism to estimate the models.FindingsThe results suggest that CSR activities reduce bank risk-taking, and this relationship is only present in the case of financially constrained banks. Unconstrained banks, on the other hand, are more likely to invest in unnecessary CSR, thus reducing bank performance and increasing bank risk-taking.Research limitations/implicationsThe first implication from this study is that CSR activities might be considered as a risk-mitigating tool and should be invested in that respect. Secondly, regulatory units and investors should be more cautious about CSR expenditures since this type of spending could increase default risk, especially for banks with easy access to external financing. One particular limitation of this study is the low number of observations available for banks in Vietnam. Future studies could use texture analysis to expand the sample or consider macro-level governance characteristics to examine which factors might modify the relationship between CSR and bank risk.Originality/valueVery limited studies discussed the link between corporate social responsibility and bank performance and bank risk. There are even fewer papers examining the relationship between CSR and risk, and most of these papers deal with advanced economies. Furthermore, no studies investigate the interaction effect of CSR and financial constraint, which should be prevalent in developing countries on bank risk. As a consequence, the current study seeks to verify the impact of financial constraints on the link between CSR and bank risk.

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Section: Literature Reviewmentioning

confidence: 99%

The impact of corporate social responsibility on the risk of commercial banks with different levels of financial constraint

Nguyen

Khương

2020

APJBA

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“…Competition positively correlates with return on assets and equity and negatively with net interest margin earned on issued loans (Zoghlami & Bouchemia 2021). Yet, competition is positively associated with loan growth (Yang & Shao 2016) and social engagement (Forgione & Migliardo 2020). However, high competition negatively impacts bank profitability (Khattak & Ali 2021, Ho & Nguyen 2022 and the market capitalization of banks (Căpraru et al 2020).…”

Section: Bank Activitiesmentioning

confidence: 99%

Competitiveness in Banking Sector: A Systematic Literature Review

Begimkulov

2023

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THE AIMS OF THE PAPER The concept of bank competitiveness has attracted increasing scientific attention. The current paper explores the directions and trends of research on bank competitiveness measures by reviewing recently published journal articles. METHODOLOGY The research follows the systematic literature review method. First, a set of keywords were defined. Then, the keywords were combined with the Boolean operator “AND” to identify articles in the two biggest scientific databases: Web of Science and Scopus. The identified papers were filtered and screened following the PRISMA method of selection. At the final stage, 33 articles were included. MOST IMPORTANT RESULTS Based on the analysis of published papers, the author identified the main research streams within bank competitiveness:risk-stability, market power, macroeconomic context, information technology, and new applications. Also, within the context of growing digitalization, little attention is paid to the influence of information technology on bank competitiveness. RECOMMENDATIONS Within the context of the growing importance of technological innovations in the financial sector (e.g., financial technology startups), there is still a lack of research on the influence of technological innovations implemented by banks on their competitiveness. Also, considering that the existing methods of measuring competitiveness in banks often provide conflicting information, developing new ways of estimating competitiveness considering the level of digitalization is necessary.

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“…On the one hand, market competition drives company ethical behaviour, due to pressure from customers, competitors, or concerns about reputation. On the other hand, strong competition in the market reducing profitability may force companies to save on, for example, non-basic activities (including CSR expenses) in order to maintain profits (Shleifer, 2004;Forgione, Migliardo, 2020). When the level of competitive activities in a given sector is high, a positive image related to CSR can improve the company's financial performance, while when the level of competitive activities is low, the lack of such activities (omitting CSR expenditure) may improve financial results (Kim et al, 2018).…”

Section: Literature Reviewmentioning

confidence: 99%

“…If the expected reputation can be built up, one can expect higher profitability of the resources involved, a better financial situation and a higher market valuation (Garriga, Melé, 2004). Therefore, CSR should be treated as a strategy that allows for higher returns in the long term, offsetting the costs incurred in the short term (Forgione, Migliardo, 2020).…”

Section: )mentioning

confidence: 99%

Untitled

2023

SPSUTOM

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The aim of the paper is to review the requirements of the non-financial reporting on climate change. Design/methodology/approach: Critical literature analysis. Analysis of international literature from main databases and Polish literature, legal acts relevant to the researched topic, and standards. Findings: The evolution of the approach to non-financial reporting highlights the trend towards measurability, comparability of indicators. Originality/value: The requirements of the new ESRS standard have been presented against the background of existing solutions.

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CSR engagement and market structure: Evidence from listed banks

Cited by 25 publications

References 40 publications

The impact of corporate social responsibility on the risk of commercial banks with different levels of financial constraint

The impact of corporate social responsibility on the risk of commercial banks with different levels of financial constraint

Competitiveness in Banking Sector: A Systematic Literature Review

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