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Commercial banks that strategically prioritise sustainability deliver a higher financial return than those that do not.

This is the key result of a recently published report initiated by the engagement of the EIB (SG/Corporate Responsibility) with the civil society organisation the Global Alliance for Banking on Values (GABV). This research, also supported by Deloitte, strongly benefitted from the detailed guidance of one of the world leading academics regarding sustainability and financial performance, Prof. George Serafeim from the Harvard Business School.

The research is based on the rating of 100 of the largest commercial banks scored regarding their pursuit of material environmental, social and governance (ESG) issues over a ten-year period (2007-2017). Applying the materiality approach of the Sustainability Accounting Standards Board (SASB), it shows that those who consistently scores well on material ESG issues, also delivers higher than average financial returns. Taking into account the limitations of the data available, this higher financial return is estimated to be about 200bps.

The Global Alliance for banking on Values regroups banks and banking cooperatives from around the world committed to advance positive change in the banking sector.