Learning Objectives:

  • Understand the principles of responsible banking.

  • Explain ESG factors and their importance in banking.

  • Analyse the role of banks in sustainable development.

7.1 Responsible Banking

The EM Normandie module covers “responsible banking practices” and “social responsibility and environmental considerations in banking” . The University of Exeter module covers “the future of banking: artificial intelligence and sustainability” .

Key principles:

  • Social Responsibility: Banks have obligations to society beyond profit maximisation.

  • Environmental Sustainability: Banks should consider environmental impacts.

  • Financial Inclusion: Banks should promote access to financial services.

  • Ethical Lending and Investments: Banks should lend and invest responsibly.

7.2 ESG Factors

The EM Normandie module covers “the growing importance of sustainable finance and the ESG (Environmental, Social, and Governance) factors” . The University of Liverpool module covers “sustainability issues” and “ESG issues into practice” . Key ESG considerations:

  • Environmental: Climate risk, environmental impact.

  • Social: Labour practices, community impact.

  • Governance: Board oversight, executive compensation.

7.3 Sustainable Finance Products

The EM Normandie module covers “innovations in responsible banking (e.g. green bonds, impact investing)” . The University of Exeter module requires students to “critically evaluate, from an ethical perspective the impact, and potential impact, of environmental factors and technological developments on current and future banking practice” . Sustainable finance products include:

  • Green Bonds: Bonds issued to finance environmentally sustainable projects.

  • Social Bonds: Bonds issued to finance projects with positive social outcomes.

  • Impact Investing: Investing to generate positive social and environmental impacts.

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