Banking and ESG investment density
a pathway to reduce income inequality in society
DOI:
https://doi.org/10.23925/2179-3565.2025v16i3p81-98Keywords:
Income inequality, Bank investment density, ESG, Bank volatility, Bank liquidityAbstract
This study explores the influence of bank investment density measures by green and sustainable investment, fintech and digital banking, financial inclusion and social equity, smart cities, and infrastructure on the Gini coefficient and Theil index indicators of income inequality (SDG-10) in society. The study reveals that bank investment density towards sustainable investment activities significantly helps to reduce income inequality. Further, we find that moderating variable Environmental, Social, and Governance (ESG) compliance has restructured traditional banking practices to sustainable initiatives for long-term sustainability. Likewise, we reveal that mediating variable bank liquidity positively channelize the funds into sustainable investment initiatives. While mediating variable bank volatility restricts the bank's ability to allocate funds for sustainable investment projects. The managers should design rigorous risk management practices to effectively implement sustainable investment projects to combat income inequality in society.
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