ESG Risk Management in Banking: Strategy, Regulation, and Market Reaction

Patrycja Chodnicka-Jaworska, Annalisa Ferrari (Authors)

ISBN: 9781041353294

Published: 2026

Format: Hardcover

Language: English

Publisher: Routledge

Description

ESG Risk Management in Banking gives finance and risk professionals a structured way to define, calculate, and act on environmental, social, and governance risk in the banking sector. It combines a review of current regulations and market initiatives with applied tools for assessing ESG risk, understanding how it shapes investment decisions, and relating it to bank capital requirements.

Key Features

• Provides working tools to calculate and assess ESG risk rather than only describing the regulatory landscape
• Analyzes how stock, bond, and credit markets actually respond to ESG risk and regulatory change, by company size, geography, and industry
• Explains how to interpret nonfinancial statements and follow the evolving legal frameworks governing ESG ratings and disclosures
• Includes a chapter on derivatives as tools for mitigating ESG risk in banking

Coverage

Introduction to ESG risk and its financial materiality · Banking-sector ESG regulation · ESG risk management frameworks · ESG risk management in practice at banks · ESG regulation's effect on financial markets · Derivatives as ESG risk mitigation tools · Practical implications for regulators, supervisors, and practitioners.

About the Authors

Patrycja Chodnicka-Jaworska is a researcher and Director of the Risk and Finance Management Center at the University of Warsaw, Poland. Annalisa Ferrari is an Associate Professor of Economics and Finance in the Department of Digital Law and Society at Unitelma Sapienza University of Rome, Italy.

Table of Contents

Introduction · Part I: ESG Risk – Key Issues (1. Introduction to ESG Risk · 2. Regulations on ESG Risk in the Banking Sector · 3. ESG Risk Management Framework) · Part II: ESG Risk Management in the Banking Sector (4. ESG Risk Management in the Banking Sector · 5. ESG Risk Regulations and Financial Markets in the Banking Sector · 6. Derivatives as Tools to Mitigate ESG Risk in the Banking Sector · 7. Main Conclusions and Implications).

Why buy this book?

ESG disclosure and ratings regulation is moving fast enough that a bank's risk, compliance, or investment team can lose a full reporting cycle just tracking what changed. This book gives that team the calculation tools and market-reaction evidence directly — how ESG risk actually moves stock, bond, and credit pricing by sector and geography — rather than a purely descriptive regulatory summary. For a financial institution building or refining its ESG risk framework, or an analyst assessing how ESG exposure affects a bank's capital position, this is a working reference, not background reading, and it belongs alongside the desk resources used for day-to-day risk assessment.

Keywords

ESG risk banking, sustainable finance, ESG regulation, bank capital requirements, ESG disclosure, green investment, financial risk management

Target Audience

Accountants, Investors and financial analysts, Financial advisors

Genre

Accounting, Economy, Finance

Q&A

What does ESG Risk Management in Banking cover?
It covers ESG risk definitions, banking-sector regulation, risk management frameworks, and how ESG risk affects stock, bond, and credit markets.

Who is this book written for?
Academics, researchers, and students in finance, economics, and risk management, as well as regulators, supervisors, and banking practitioners.

Does the book explain how to calculate ESG risk?
Yes — it provides tools to calculate and assess ESG risk and relate it to bank capital requirements.

Does it cover the relationship between ESG risk and bank capital requirements?
Yes — that relationship is a core focus, alongside how to interpret nonfinancial statements and ESG disclosures.

Is derivatives-based ESG risk mitigation covered?
Yes — a dedicated chapter examines derivatives as tools to mitigate ESG risk in banking.

Where can I buy ESG Risk Management in Banking: Strategy, Regulation, and Market Reaction?
Through CLNZ Books, with worldwide shipping and secure payment by card, PayPal, or bank transfer.

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