Purpose

The purpose of this paper is to investigate whether banks’ environmental, social and governance (ESG) initiatives increase or decrease banks’ efficiency.

Design/methodology/approach

The sample used includes all listed banks in Saudi Arabia over the years 2016–2021. The authors performed different methods, including data envelopment analysis (DEA), ordinary least squares (OLS) and quantile regressions.

Findings

The OLS regression results show a negative linkage between ESG and banks’ efficiency. Further, the quantile regression analysis indicates that the ESG effect on banks' efficiency is negative across different quantiles. However, the DEA method shows that the DEA-generated scores for Banks’ efficiency are higher for ESG-adjusted scores in comparison to efficiency scores without incorporating ESG. Further, the comparison of the DEA-generated efficiency scores, over the sample period, of adjusted ESG banks still suffers from decreasing in their efficiency over the years. Concerning existing theory, the results are consistent with the stakeholders and the resource-based theories postulating that banks' ESG practices are ethical commitments and enable firms to gain competitive advantage and increase their reputation among stakeholders.

Practical implications

The findings of this study offer important implications for regulators and bankers. Policymakers and bank regulators should make collective efforts to encourage financial institutions to adopt green finance initiatives to create an efficient financial system capable of counteracting risks from the external environment and stimulating economic growth. Banks’ managers should be aware that ESG initiatives serve society and the environment and offer a positive influence on banks’ efficiency.

Originality/value

To the best of the authors’ knowledge, this is the first study to explore the influence of ESG activities on banks' efficiency using DEA for banks in Saudi Arabia.

中文翻译：

---

ESG 实践和银行效率：来自石油驱动型经济的新证据

目的

本文的目的是调查银行的环境、社会和治理（ESG）举措是否会提高或降低银行的效率。

设计/方法论/途径

使用的样本包括 2016 年至 2021 年沙特阿拉伯的所有上市银行。作者采用了不同的方法，包括数据包络分析 (DEA)、普通最小二乘法 (OLS) 和分位数回归。

发现

OLS 回归结果显示 ESG 与银行效率之间呈负相关。此外，分位数回归分析表明，ESG 对银行效率的影响在不同分位数上均为负值。然而，DEA 方法表明，与未纳入 ESG 的效率得分相比，DEA 生成的银行效率得分中经过 ESG 调整的得分更高。此外，在样本期内，对 DEA 得出的效率得分进行比较后，调整后的 ESG 银行的效率多年来仍然在下降。就现有理论而言，结果与利益相关者和基于资源的理论一致，假设银行的ESG实践是道德承诺，使企业能够获得竞争优势并提高在利益相关者中的声誉。

实际影响

这项研究的结果对监管机构和银行家具有重要意义。政策制定者和银行监管部门应共同努力，鼓励金融机构采取绿色金融举措，建立能够抵御外部环境风险、刺激经济增长的高效金融体系。银行管理者应该意识到ESG举措服务于社会和环境，并对银行效率产生积极影响。

原创性/价值

据作者所知，这是第一项利用 DEA 对沙特阿拉伯银行探讨 ESG 活动对银行效率影响的研究。