Does ESG contracting align or compete with stakeholder interests?
研究了银行ESG契约对ESG表现和争议的影响，发现ESG契约虽提升表现但也增加争议，更多是象征性而非实质性满足利益相关者利益。
• ESG contracting improves banks’ ESG performance. • ESG contracting raises the number of banks’ ESG disputes. • ESG strategy, ESG committee, and managerial risk-taking are relevant channels. The paper investigates whether ESG-linked managerial incentives, also known as ESG contracting, align or compete with stakeholder interests in the banking sector. The few related literature, focussed on non-financial companies, shows arguments both pro and against pay for sustainability. Using a panel data set of 595 worldwide listed banks for the period 2010–2021, the paper studies the effectiveness of ESG incentives in improving ESG performance and limiting ESG controversies. ESG contracting is shown to improve both ESG performance and ESG disputes, thus suggesting that it is more symbolic than substantial in meeting stakeholder interests. ESG strategy, ESG committee and managerial risk-taking are significant channels through which ESG incentives affect ESG performance and ESG controversies in the banking sector.