Sustainability disclosure of Indian banks and Their Relationship with Bank Attributes

Imagine the banking world as a massive, bustling city where banks are the skyscrapers. For a long time, these skyscrapers only showed off their shiny gold coins (financial reports). But recently, the city's mayor (SEBI, India's market regulator) handed out a new rulebook called BRSR. This rulebook says, "Hey, don't just show us your money! Show us how you treat the environment, your workers, and your neighbors. We want to see your 'sustainability report card'."

Two researchers, Suman and Kamakshi, decided to play detective. They wanted to see which banks were actually following the rules and, more importantly, why some banks wrote better reports than others. To do this, they built a special measuring tape called the Sustainability Business Disclosure Index (SBDI). Think of this index as a "report card score" that grades banks on how much non-financial information they share.

The Detective Work

The team looked at 26 banks (a mix of public and private ones) and checked their reports for 134 specific items across 11 categories, like "Employee Well-being," "Human Rights," and "Environment." They gave a point for every item mentioned and zero for anything missing. It was like grading a homework assignment where you get points for every question you answer.

The Big Reveal: What They Found

After crunching the numbers, here is what the data actually whispered to them:

1. Age Matters (But Not in the Way You Might Think): The researchers found a negative trend where older banks tended to have lower SBDI scores. The data showed that for every year a bank got older, its disclosure score dropped by about 0.0567. The paper notes that this relationship was statistically significant (p < 0.05), meaning the data shows a real correlation in this specific sample. However, the study does not definitively conclude that older banks are "worse" at reporting in a broad sense, nor does it explain why this happens. The data simply shows that in this group, age and disclosure levels move in opposite directions, but the paper does not offer a causal explanation like older banks being "stuck in their ways."
2. Size Doesn't Guarantee a Good Report: You might think a giant bank with a huge wallet would have the best report card. The paper tested this by looking at Market Capitalization (how much the bank is worth). The result? No clear statistical connection. The data showed a tiny, positive trend, but it wasn't strong enough to say for sure that size helps. The paper does not claim that big banks are bad at reporting; it simply found that being big doesn't automatically make you a sustainability champion based on this data.
3. Going Global Doesn't Help Either: The team also checked if banks that do business internationally (Foreign Association) wrote better reports. They found no significant link here either. Just because a bank has friends in other countries doesn't mean it's more likely to share its secrets about sustainability. Again, the study didn't prove that international banks are worse; it just couldn't find enough evidence to say they are better.

The Scoreboard

So, who got the best grades?

• Yes Bank took the top spot with a 75% disclosure score. They shared the most information about non-financial stuff.
• Federal Bank and Ujjivan Small Finance Bank were close behind with 72%.
• Bank of India had the lowest score at 34%, meaning they left a lot of questions unanswered in their report.
• On average, the banks scored around 59.6%. This means that, generally, banks are sharing some non-financial info, but they are still missing about 40% of the details the researchers were looking for.

What the Paper Says is Not True

It's important to know what this study didn't find. The paper does not explicitly argue that bigger banks or international banks are bad at sustainability. Instead, it found that the link between these factors and better reporting is statistically insignificant. While some people might guess that big companies have more resources to write good reports, this study's data says, "We can't prove that size helps." Similarly, it couldn't find enough evidence to say that simply being a "foreign" or international player guarantees better transparency. The study leaves the door open that these factors might matter, but the evidence in this specific sample wasn't strong enough to confirm it.

How Sure Are We?

The researchers found a statistically significant negative relationship between age and disclosure (at the 5% level), meaning the data shows a real pattern where older banks in this sample disclosed less. However, the paper is careful not to overstate this as a universal rule for every bank, nor does it speculate on the reasons behind it. For size and foreign connections, the paper is more cautious. It says these factors might have a tiny positive effect, but the evidence isn't strong enough to call it a fact yet. It's like seeing a faint shadow and saying, "It looks like a person, but I can't be 100% sure until I turn on the lights."

The Takeaway

The main message is that in the Indian banking world, being old doesn't mean being transparent. In fact, the data suggests that the older the bank, the less likely it is to share its sustainability story (within this specific sample). The researchers hope their new "report card" (the SBDI) becomes a standard tool so that regulators, investors, and regular people can easily see which banks are truly walking the walk when it comes to saving the planet and helping society. They aren't saying the problem is solved, but they've handed everyone a better flashlight to find the truth.