Environmental Risk Management Strategies and the Moderating Role of Corporate Social Responsibility in Project Financing Decisions

Abstract

The purpose of this study is to examine the moderating role of corporate social responsibility (CSR) in project financing decisions. CSR has gained growing prominence in today's business era. This study investigates four environmental strategies and the credit risk assessment, stakeholder assessment and corporate social responsibility assessment impact on project financing decision. It explores three main issues related to environmental responsibility (planet), economic responsibility (profit) and social responsibility (people). The study is explanatory and quantitative, and both domestic and foreign banks participated in the data collection process. The sample size for the study is 491 participants. Data was collected through a simple random sampling technique and was analyzed by applying simple linear regression, confirmatory factor analysis (CFA) and structural equation modeling analysis (SEM) through the Statistical Package for the Social Sciences (SPSS). The study shows that the Pakistani banking sector is implementing environmental management policies. Foreign banks are more motivated towards corporate social responsibility practices. Cultural differences can influence a manager's attitude towards implementation of environmental risk-management policies. The result shows that corporate social responsibility has a moderating role in project financing decisions and environmental risk management, stakeholder and credit risk assessment. All hypotheses has significant values.

The Role of Enterprise Risk Management in Sustainable Decision-Making: A Cross-Cultural Comparison

“…This study also adds implications to the existing literature regarding the link between risk management and sustainability. Although the prior literature has suggested that there is a theoretical connection between risk management and sustainability [2,7,25,38,44], this stream of research is still limited [2,26]. The findings of this study suggest that although there is a positive link between risk management and sustainability, simply adopting risk management elements is not sufficient for ensuring sustainable decision-making.…”

“…Risk management has been viewed as an important practice for improving sustainable decision-making [3][4][5][6][7][8]. Unsustainable behaviors can generate potential business risks to an organization's reputation and ultimately result in the collapse of an organization [9].…”

Demonstrating the Impact of Cognitive CEO on Firms’ Performance and CSR Activity

“…The extant literature has revealed that corporate governance not only influences a firm's growth but also affects corporate social responsibility (Bhagat and Bolton, 2019;Zhou, 2019). One study has indicated that corporate social responsibility even influences employee performance in SMEs (Sarfraz et al, 2018a) while, conversely, another emphasizes the moderating role of CSR, which affects project financing (Sarfraz et al, 2018b). However, the CEO is a pivotal figure who can orientate the firm toward adopting CSR measures.…”

Sustainable Entrepreneurial Culture Programs Promoting Social Responsibility: A European Regional Experience

“…Sustainability and Corporate Social Responsibility (CSR) are directly linked as it has been widely demonstrated in the specialized academic literature [63][64][65]. Both terms are, at the same time, starting to be intrinsically connected with a new model of capitalism [66,67].…”