Rome, February 6-7th 2025

Updating Cooperative Banks – Small Businesses ties: from credit access to ESG performance

Di Marco Beatrice, Lumsa
Ferri Giovanni, Lumsa
Pini Marco, Centro Studi Tagliacarne

Nowadays value creation is not simply short-term profitability but demands that an enterprise also reports a satisfactory ESG (Environmental, Social and Governance) score. This applies also to micro- and small-sized enterprises (MSEs). If in the past the relationship with cooperative banks improved MSEs access to credit, today’s enlarged mission would be if this relationship was accompanied by an improvement in MSE performance in terms of ESG score. Is that really so? To investigate whether CCBs enhance MSEs’ ESG performance, an innovative metric was developed using enterprise-level data for Italy from the 2023 Survey of the Tagliacarne Institute. The results we obtain withstand robustness checks, even ruling out endogeneity via an instrumental variables approach, and offer solid empirical evidence supporting our hypotheses. Finally, we find a proximity outcome where the pro-ESG effect is stronger if the borrowing enterprise is located close to a CCB branch.

Area:

Keywords: Cooperative Banks; Small Businesses; Access to credit; ESG performance

Please Login in order to download this file