Stage of the Portuguese Banking Sector - Consideration of ESG factors and recommendations for improvement

ESG issues cut across several economic sectors, but also the legal sciences, and in law they have taken on different names, from Sustainable Development to the most recent acronym ESG. At the end of 2021, CIDEEFF opened a line of research funded by the FCT linked to Sustainable Finance, covering both the Private Finance component, in the relationship between financial markets and sustainability, and Public Finance, in the interaction between the State Budget and Tax Policy with the SDGs.
From this, two projects were born:
1. an international conference on "Sustainable Finance: between public and private solutions", to be held on 4 July 2022 at the Faculty of Law of the University of Lisbon, with renowned national and foreign researchers, members of public institutions such as financial supervisory authorities and the Public Finance Council, and representatives of financial intermediaries. This dialogue between Academia, the State and the Markets was then transposed and enriched in a book to be published in April 2024 by Springer;

2. a study on the stage of development of the Portuguese banking sector in terms of taking ESG factors into account and recommendations for their improvement, which are aimed at credit institutions and their supervisors. This study, which is now being published and which is the result of the tireless work of two CIDEEFF researchers - Luciane Moessa de Souza, as principal investigator, and André Alfar Rodrigues - is not intended to be an audit of the sustainable activity of banks, but a (methodologically demanding) portrait of their stage of progress, taking into account institutional self-reports, identifying their strengths, but also their weaknesses and shortcomings. The ultimate aim is to allow an informed and empirical reflection on the greater or lesser internalisation by the financial markets - banking in particular - of the importance of the issue of sustainability in their activity, as the driving force behind a paradigm shift.
This report is therefore a valuable contribution by CIDEEFF to research into Sustainable Finance, and we plan to continue exploring the subject over the next four years, now looking at its expression in the PALOP countries, not least as a factor in local socio-economic growth and development.

Rute Saraiva (Research Coordinator)