China imposed environmental, social and governance regulations on banks since 2012, but their impact on environmental disclosures is unclear. This study aims to examine the evolution of environmental disclosures in Chinese commercial banks from 2012 to 2021.
This study develops a framework for direct and indirect environmental impacts of banking. It examines environmental disclosures from six Chinese banks in the Sino-British “Climate and Environmental Information Disclosure Pilot Program”. Using content analysis, 49 CSR, sustainability and ESG reports over ten years are examined.
The study shows that Chinese banks’ environmental disclosures are rising, particularly in environmental impacts and governance, despite varied focuses. State-owned commercial banks under coercive pressures and Equator Principles members under normative pressures both enhance disclosures to compete.
Banks are understudied in social and environmental accounting. Unlike polluting industries, their environmental and social responsibilities are unique, involving direct and indirect aspects. Their lending and investments have sensitive spillover effects. In China, commercial banks adopt environmental initiatives that demonstrate the interplay of legitimacy, institutional theory and stakeholder salience.
