Olaf Weber

This study investigates the financial consequences of greenwashing, operationalized as the misalignment between ESG disclosure and actual ESG performance. While prior research has explored the reputational and ethical dimensions of greenwashing, its impact on firms' cost of debt remains underexamined. Drawing on a panel of 411 S&P 500 companies over a 10‐year period (2014–2023), we construct two firm‐level indicators of greenwashing, grESG and gr2ESG, based on z‐scores and percentile ranks, respectively. These measures capture the credibility gap between what firms communicate and what they deliver in terms of sustainability. Using random effects within‐between (REWB) models, we decompose structural (between‐firm) and temporal (within‐firm) effects to assess how ESG inconsistency influences debt pricing. Our findings reveal that the between‐firm component of greenwashing is positively and significantly associated with the after‐tax cost of debt, suggesting that financial markets interpret ESG misalignment as a persistent reputational trait rather than a short‐term deviation. The results are robust across alternative specifications, including models that account for ESG‐related controversies. The study contributes to the literature by demonstrating that ESG credibility is a priced financial attribute and that symbolic sustainability efforts, defined as disclosure‐oriented or reputational gestures without substantive operational changes, may backfire in terms of financing costs.

Research on sustainable finance has experienced significant growth in recent years, but the exploration from a comprehensive perspective is still in its nascent stages. As of July 2023, our research revealed that this area remains relatively underexplored in the existing body of knowledge, leading to a notable lack of comprehensive research analyzing the current state‐of‐the‐art in the social finance arena. To address this gap, our study takes a pioneering approach by utilizing scientometrics and network analysis techniques, specifically employing VOSviewer and Bibliometrix in conjunction with Web of Science and Scopus databases. By merging data from both sources and removing duplicate entries, we established a consolidated database of 401 relevant studies. Through our analysis, we have identified prominent authors, sources, and the most influential studies in the social finance arena. Additionally, we examined the coupling of studies and authors to ascertain their significance in this emerging domain. The results have unveiled several prominent further research, including mainly social banking, Islamic finance, social innovation, the impact of the COVID‐19 pandemic, impact investing, social impact bonds, and Sustainable Development Goals. By shedding light on the current landscape, our findings comprehensively understand the field's progress and potential directions. This insight is valuable for market participants, researchers, policymakers, and decision‐makers seeking to navigate and contribute to the evolving landscape of sustainable finance with a social focus. Furthermore, our innovative use of scientometrics and network analysis sets a precedent for future research exploring the complex interplay between finance, development, and sustainability.

This study examines the impact of workforce practices on firms’ environmental and social performance. The mediating impact of firms’ financial performance and the moderating impact of firm age on workforce practices and environmental/social performance are also investigated. Data were collected through the Refinitiv database from a sample of 224 large, actively traded Canadian firms listed on the Toronto Stock Exchange (TSX). A linear regression model was used to test the effect of various workforce practices on firms’ environmental and social performance. The findings have important implications for the direct and indirect impacts of workforce practices on firms’ environmental and social performance. While the direct impact was found to be significant, firms’ financial performance was found to fully mediate the workforce-environment/social performance relationship. The findings also demonstrated that the impact of firm age on workforce practices and environmental/social performance via financial performance was significant. The study draws on the signaling theory to empirically investigate the contextual aspects that affect the association between various workforce practices and firms’ sustainability performance. The findings can be utilized by firms to select the right mix of practices to tailor workforce management and achieve better sustainability performance in their environmental and social initiatives.

Project finance of energy and infrastructure projects is discussed intensively with regard to its positive and negative impacts on sustainable development. While there is a relatively broad agreement about phasing out financing coal mines and coal fired power plants, other fossil fuel projects and fossil fuel related infrastructure is still financed. This is even true for members of the Equator Principles, a financial industry benchmark for determining, assessing and managing environmental and social risk in projects. This article will analyse current sustainability approaches in project finance by MDBs, other banks, and project sponsors. Amongst them approaches of the Equator Principles, World Bank, and the Asian Development Bank will be analysed with regard to addressing the SDGs. Since, most of the current sustainability frameworks in project finance are trying to reduce social and environmental risks for the project financier, when expect a low impact on achieving the SDGs.

Based on a dataset collected from the Scopus database, this study aims to present a comprehensive knowledge map of academic research on climate and environment-related financial risks by identifying current gaps and promising avenues for further research. A bibliometric analysis and systematic literature review method were employed to analyze the sample using VOSviewer software. In particular, the co-occurrence of keywords and the cluster analysis led us to identify five research themes. Three themes can be considered the core of this research field and include the following research hotspots: adaptation finance, environmental credit risk management, and environmental risk/environmental liability. In contrast, the themes related to climate stress testing and credit provision can be considered the two main emerging areas of debate. The work also discusses prominent insights from the research analyses and recommends future research directions.