'ESG' targets in the corporate governance of banks: KPI and double materiality (impact and financial materiality)

738The article addresses the role assumed by the banking sector in the transition towards a more sustainable economic system, i. e. one that combines the pursuit of profit with due consideration of other objectives aimed at mitigating the negative impacts of entrepreneurial activity on human rights and the environment. Known by the acronym “ESG”, we refer of course to so-called “Environmental, Social and Governance” objectives. The research focuses principally on the corporate governance “tools” that banking institutions must equip themselves with to facilitate an approach that considers “ESG” factors not only as elements of risk to be contained, but also as an opportunity to be managed and included in industrial plans. With the emphasis being on the means to integrate sustainability into the business of the banking, the analysis looks at recent European legislation on sustainability reporting, which introduces the principle of “double materiality”, and pays particular attention to Italian legislation and the doctrinal debate therein.