ENVIRONMENTAL DISCLOSURE PRACTICE IN THE SERBIAN BANKING SECTOR

This paper aims to: a) analyse the environmental disclosure practice in the Serbian banking sector, b) determine whether the degree of disclosure is higher in the case of big, i.e. systemically important banks, and c) examine if there is a positive relationship between the banks' CSR practice and their fnancial performance. The environmental disclosure index (EDI) based on 15 variables was employed to measure environmental disclosure performance for the Serbian banking industry. The data were generated through content analysis of the annual and sustainability reports of a total of 10 banks, fve of which were classified as systemically important banks for the period 2015-2019. The sample was determined by the availability of reports for the analysed period and the bank establishment year. The results show that the majority of Serbian banks discloses their environmental policy (74%), the undertaken environmental activities with the local community (51%), and the utilization efciency of water, energy, and paper (48%). Although the findings indicate that the environmental disclosure practice among all banks in Serbia is growing, the reports are not standardized. In addition, the systemically important banks in Serbia do not have a better disclosure practice. The econometric analysis implies that the bank's status does not infuence the level of environmental disclosure and that there is no positive relationship between fnancial performance (ROA and ROE) and EDI. This study has implications for policymakers and accounting bodies in Serbia in standardizing non-fnancial reporting and creating certain green and sustainable banking guidelines. Keywords: environmental disclosure, banking sector, content analysis, Serbia
1. INTRODUCTION Due to increasingly unfavourable climate changes that the world has been witnessing, the environment started to be analysed as one of the company's stakeholders (Dragomir, 2010). Research discourse [...]