Vienna (OTS) – Under the title “Banking for a Better Future”, the KPMG study provides insight into the dynamics of the banking industry and shows a picture of the current and future challenges of the sector with a focus on the topic of sustainability.
Looking at the EU action plan to achieve environmental and climate goals by 2030, there are more and more companies that are investing immense amounts of money in their sustainability transformation. When it comes to sustainable business, the banking sector plays a central role: as investors, banks have considerable influence on which sustainable projects and companies are invested in. In doing so, they are significantly driving forward the green transformation.
Sustainability as a business model of the future
The results clearly show that hardly any banking institution has any evidence of taking ESG aspects into account when addressing customers. In particular, institutes with a business area clearly geared towards large corporate customers have expanded their market presence to include offers for the sustainable transformation of their customers’ production processes, sales channels and supply chains.
Differences can be observed primarily in the degree of ESG integration into the business model: Sustainability can be implemented as a supplement to the established range of services, stand as a separate segment in the portfolio or – in the strongest form – function as an original business model. “In contrast to Germany and Switzerland, there is currently no domestic banking institution in Austria where sustainability is actually the essence of the business model. Whether this will actually happen to us remains to be seen. However, we assume that sustainability will become increasingly important in business models over the next few years, because the study results show that 62% of Austrian banks see ESG as having great potential for business expansion,” says Tim Schabert, partner at KPMG Austria .
ESG and the risk of banks
It is clear that in addition to a multitude of opportunities, ESG also presents numerous challenges. The increasing regulatory focus in the form of requirements and reporting requirements – such as the Corporate Sustainability Reporting Directive (CSRD) and the EU Taxonomy – is also forcing banks to rethink and adapt their strategies, business models, governance structures and ESG risk management. However, established control frameworks are not being thrown out: “The further development of these aspects does not necessarily mean setting up completely new control systems, but rather the adaptation and integration of existing tools, methods and processes,” says Thomas Gaber, partner at KPMG Austria.
Banks also face challenges with “green loans” because financing technological changes requires special risk assessments. Investment projects in new technologies and processes that pursue sustainability goals can be associated with higher risks. “Investing in green technologies often has the characteristics of start-up financing. Contrary to intuition, green loans are often even riskier,” says Gaber.
Further results of the study
- 69% of the bank board members surveyed see it as challenging or critical as to whether the Paris climate goal – i.e. limiting the increase in the global average temperature to well below 2 °C – can be achieved.
- The analysis of the sustainability reporting of Austrian banks currently shows a very diverse picture. Only over time can harmonization in reporting practices be expected.
- 81% of the banks examined subjected their sustainability reports to a voluntary audit in 2022.
Further information and the study can be downloaded here: KPMG Newsroom
Questions & Contact:
KPMG Austria GmbH
Stomach. Lisa Kannonier
Porzellangasse 51
1090 Wien
+43 664 8213 664
lkannonier@kpmg.at
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