Exploring the Relationship Between ESG Practices, ESG Risk Factors and Profitability of Financial Institutions: Triangulation of Methodological Approaches

January 1, 2026Open Access

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Key Points

The aim is to illuminate key questions regarding the aggregation of ESG indicators and their impact on profitability.
Analyzed data from 294 European financial institutions using various quantitative methods.
Applied techniques include multiple linear regression, structural equation modeling, and regression moderation analysis.
Employed triangulation of data processing methods to enhance the analytical framework.
Financial institutions cannot achieve higher return on assets (ROA) without developing ESG management factors.
ESG risk factors moderate the effect of ESG practices on ROA, particularly under high environmental risk conditions.
The use of less common statistical techniques in sustainable finance represents a methodological contribution.

Demonstrates the impact of ESG practices on profitability in financial institutions, suggesting vital management strategies.

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Ana Ivanišević Hernaus (2026) studied this question.

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