Environmental, social and governance (ESG) management is important to manage corporate risks and create business opportunities. ESG management is more prevalent in financial products (e.g. ESG loan products and ESG bonds). But banks launching inappropriate financial products and falsely reporting ESG performance to consumers raise questions about ESG authenticity. This study looks at the framework of ESG management – ESG authenticity, satisfaction and word-of-mouth intention – in a financial context.
Data were collected from customers of banks in S. Korea. We used an online survey company panel for data collection. Respondents were presented with information about ESG management of the largest bank in South Korea (e.g. the bank’s sustainability report) and asked to answer questions.
ESG management attributes (fit, consistency and transparency) influence ESG authenticity in both younger and older groups. Meanwhile, fit influences satisfaction in the older group, but not in the younger group. Consistency influences satisfaction in both younger and older groups. Contrary to our expectation, transparency is not found to have any significant effect on overall satisfaction in either group.
This article provides that all three attributes of ESG management influence consumers’ perceptions of the authenticity of ESG. Companies can allocate ESG attributes based on the weights of predictors of ESG authenticity. This has different effects depending on age, so it should be considered when establishing a strategy.
