About a-team Marketing Services
The knowledge platform for the financial technology industry
The knowledge platform for the financial technology industry

A-Team Insight Blogs

Lenders Divided on Addressing ESG Integration: Survey

Subscribe to our newsletter

Banks worldwide are split on how they manage ESG and climate risks, according to a new report by consultancy Bain and Company.

The study of 55 International Association of Credit Portfolio Managers (IACPM) members with total assets of more than US$40 trillion found that 65 per cent them hadn’t created a primary role that is accountable for “identifying and addressing climate risks within their operations”, the report stated. Additionally, 55 per cent said there are still “unclear roles and responsibilities for managing climate risk between their companies’ business and corporate functions”.

While ESG investing has rocketed up financial institutions’ agendas, the companies have found it more of a struggle to account for the sustainability performances of their assets and their own operations. It’s a situation mirrored by the corporations and instruments in which they invest.

Without rapid improvements, the shortcomings in integrating ESG processes is likelier to intensify as more green- and sustainability-linked products are launched: Bloomberg estimates that a third of all fund allocations will have an ESG focus by the middle of the decade.

“Incorporating ESG strategies into banking operations requires a delicate balance of managing risk and seizing opportunities,” said Michael Kochan, partner in Bain & Company’s Financial Services practice. “The gap between ESG aspirations and results has widened for many financial services institutions, despite increased pressure from stakeholders. Winners will focus strategy to create tangible value from climate-related products, services, and consulting.”

The Bain study also found:

  • 40 per cent of lenders surveyed said they didn’t embed accountability within their business lines;
  • 83 per cent expect more influence from regulators;
  • 67 per cent expect more influence from customers;
  • 53 per cent expect more influence from shareholders.

Bain identified four areas in which banks could improve their performance, one of which was to augment climate-risk data analytics capabilities.

These risk factor should be integrated “into core banking processes, leading to sustainable long-term value creation”, the report stated.

Subscribe to our newsletter

Related content


Upcoming Webinar: ESG standards and taxonomies – A progress report

Date: 15 June 2023 Time: 10:00am ET / 3:00pm London / 4:00pm CET Duration: 50 minutes The development of ESG reporting and disclosure standards and taxonomies has progressed rapidly over the past few years, yet there is still no certainty on whether there will ever be measures that can be applied on a global basis....


ESG Data and Tech Summit Report: The Art of Getting Data Right

ESG has become an integral, complex part of financial institutions’ workflows, making it crucial that they get their data and technology provisions right. But in this fast-changing part of the data ecosystem, what constitutes “right” isn’t easy to define. At A-Team Group’s second ESG Data and Tech Summit London last week, leading practitioners from the...


ESG Data & Tech Summit London

The ESG Data & Tech Summit will explore challenges around assembling and evaluating ESG data for reporting and the impact of regulatory measures and industry collaboration on transparency and standardisation efforts. Expert speakers will address how the evolving market infrastructure is developing and the role of new technologies and alternative data in improving insight and filling data gaps.


ESG Handbook 2023

The ESG Handbook 2023 edition is the essential guide to everything you need to know about ESG and how to manage requirements if you work in financial data and technology. Download your free copy to understand: What ESG Covers: The scope and definition of ESG Regulations: The evolution of global regulations, especially in the UK...