Affiliation:
1. HEC Lausanne, Faculty of Business and Economics, University of Lausanne, 1015 Lausanne, Switzerland
Abstract
The sustainable development goals (SDGs) have been widely embraced by organizations as a sign of their commitment to sustainability. In this study, we develop a novel SDG-related bidirectional encoder representations from transformers (BERT) model, using the neural network methodology, to determine the thematic evolution of European banks’ sustainability reports. We train this model on the OSDG-CD corpus, which we extend by labeling approximately 10,000 sentences based on SDGs content. The classification capabilities of this model appear to be very effective. Analysts who use our methodology can make faster decisions about the sustainability claims of financial institutions. Our methodology can be extended to non-financial entities. By analyzing the sustainability reports of 98 listed banks covering the accounting periods ranging from 2010 to 2022, we can identify the temporal emphasis of the SDGs. By 2022, climate action had emerged as the most important focus theme. We further validate our classification methodology by establishing a strong correlation between the evolution of SDG prevalence and relevant macroeconomic indicators. We also reveal a difference in focus between various European regions. Finally, we use word counts and k-means cluster analysis to document changes in the objectives of banks by investigating their discussion content.
Subject
Management, Monitoring, Policy and Law,Renewable Energy, Sustainability and the Environment,Geography, Planning and Development,Building and Construction
Reference62 articles.
1. United Nations (2015). Transforming Our World: The 2030 Agenda for Sustainable Development, UN General Assembly.
2. Presidential Address: Sustainable Finance and ESG Issues—Value versus Values;Starks;J. Financ.,2023
3. Allen, F., and Gale, D. (2000). Comparing Financial Systems, MIT Press.
4. On the foundations of corporate social responsibility;Liang;J. Financ.,2017
5. Sustainability reporting in banks: History of studies and a conceptual framework for thinking about the future by learning from the past;Baldissera;Corp. Soc. Responsib. Environ. Manag.,2023