Factors affecting the disclosure of ESG information: an experimental study at Vietnamese commercial banks

Abstract

The disclosure of information and the enforcement of ESG policies have become a trend in responsible investment not only for non-financial companies but also for financial institutions - commercial banks. However, in emerging countries like Vietnam, the level of ESG information disclosure is still in its infancy. Therefore, this research aims to identify the influence of factors on the level of ESG information disclosure of Vietnamese commercial banks. The article uses the GMM regression model to assess the impact of factors on the level of ESG information disclosure of 21 Vietnamese commercial banks in the period from 2018 to 2022. In which, the dependent variable is the level of information disclosure of Vietnamese commercial banks measured according to the International Fair Finance Guidelines Method. The results show that the disclosure level of Vietnamese commercial banks is greatly influenced by factors related to the characteristics of the banks. Among these, bank size, financial efficiency, and the level of competition among banks are factors driving banks to disclose ESG information. Conversely, banks with higher leverage tend to restrict ESG information disclosure. Additionally, among environmental factors such as corruption control, legal compliance, economic and social development, only corruption control and legal compliance have an impact on the level of ESG information disclosure by banks.