Search Results (8)

This study examines the relationship between banks’ ESG performance and core risk and balance sheet indicators in the Turkish banking sector. Using an unbalanced panel of eight banks listed on Borsa Istanbul over the period 2008–2023, we estimate bank fixed-effects models with one-year-lagged ESG measures and controls and report Driscoll–Kraay standard errors. Two complementary specifications are employed: one based on the composite ESG score and another based on its environmental (E), social (S), and governance (G) pillars. The findings suggest that the composite ESG score is positively associated with non-performing loans and capital adequacy, while its relationship with liquidity risk and net balance sheet position/equity is less stable across specifications. When the ESG pillars are examined separately, substantial heterogeneity emerges across the E, S, and G dimensions. In particular, the environmental score is negatively associated with capital adequacy, whereas the social score is negatively associated with net balance sheet position/equity. Governance-related results appear weaker and more sensitive to specification choice. Overall, the findings indicate that ESG does not operate through a uniform risk channel in banking and should be interpreted as associational rather than causal. The study contributes evidence from an emerging-market banking system and highlights the importance of disaggregated ESG analysis. Full article

The banking sector faces increasing pressure to balance financial performance with sustainability goals amid ongoing digital transformation, regulatory reform, and societal expectations for ethical responsibility. Entrepreneurial leadership has emerged as a pivotal approach for addressing these challenges; however, the behavioral and contextual mechanisms through which it shapes sustainability remain insufficiently understood. Drawing on Social Learning Theory (SLT), this study investigates how and when entrepreneurial leadership enhances sustainable bank performance through the mediating role of employee creativity and the moderating influence of an innovation-oriented climate. A two-wave multi-source survey was conducted among 459 employees and managers from Turkish banks, and the hypothesized model was tested using structural equation modeling to ensure robust empirical validation. The results indicate that entrepreneurial leadership significantly fosters employee creativity, which serves as a critical behavioral mechanism linking leadership behaviors to sustainability-oriented outcomes. Moreover, an innovation-oriented climate strengthens both the direct effect of entrepreneurial leadership on creativity and its indirect effect on sustainable bank performance, emphasizing the contextual importance of supportive organizational environments. Theoretically, this study extends the leadership and sustainability literature by illustrating how learning and behavioral modeling processes translate leadership vision into sustainable performance. Practically, it offers actionable guidance for bank executives to develop innovation-oriented climates, empower employees’ creative engagement, and design incentive systems that align leadership behavior with sustainability imperatives, thereby enhancing resilience and long-term competitiveness. Full article

This study analyzes Turkey’s development toward a green economy between 1990 and 2022 within the framework of certain green economic indicators. The data consist of secondary data from the official databases of the World Bank and the Turkish Statistical Institute (TURKSTAT). In the study, the total amount of carbon emissions was chosen as an indicator of green growth, while gross domestic product per capita (GDP) represents economic growth, domestic loans granted by banks to the private sector (as a percentage of GDP) and foreign direct investment represent financial development, and electricity generation represents pollution. To determine whether the variables are cointegrated and to determine the direction and strength of the relationship between the variables, the ARDL bounds test and the FMOLS and DOLS long-run estimators were used. Finally, Toda Yamamoto (TY)–Granger tests were performed to determine causality. The long-term relationship between the variables was confirmed by the results of the ARDL bounds test. The error correction coefficient (CointEq(−1)) was estimated to be statistically significant and negative (−0.757) when the short-term analysis was performed. This result shows that the short-term imbalances will be corrected in less than a year, and the system will approach the long-term equilibrium. In the long-term analysis of the model, all variables selected to explain the dependent variable were found to have a statistically significant impact on the dependent variable. The GDP per capita variable, the indicator of economic growth, has a negative effect on the dependent variable, while the other independent variables have a positive effect. The results of the causality analysis indicate that the dependent variable carbon emissions (CO₂) has a unidirectional causality relationship with domestic credit provided to the private sector by banks (DC), which represents financial development, and with total electricity production (EP), which serves as an indicator of pollutants. Full article

This study aims to evaluate the long-run and causality relationships between the annual grain production (kg per hectare) in Turkey, fertilizer used in agriculture, the number of tractors, agricultural greenhouse gas emissions, and grain production area from 1988 to 2018. The study’s data for the years 1988–2018 were taken from the World Bank and Turkish Statistical Institute (Turkstat) databases. The autoregressive distributed lag bounds (ARDL) test was applied to estimate the cointegration between the variables. The cointegration test results confirmed a long-run relationship between the variables. The short-run estimation revealed that the error correction coefficient was negative and statistically significant. The result obtained for the error correction term estimated that the deviations from the short-run equilibrium would be corrected, and the system would converge to the long-run equilibrium within 1.05 years. Further, the long-run estimation showed that all variables included in the model had a statistically significant effect on the dependent variable. While this relationship was negative for grain production amount and carbon emission, it was positive for fertilizer use and the number of tractors. The grain areas estimated as the dependent variable in the ARDL model were in a feedback relationship with the current production and number of tractors variables, while the fertilizer and carbon emission variables were in a unidirectional causality relationship towards the grain production area. There is a negative relationship between grain production (kg per hectare) and grain production areas (hectares). A 1% increase in grain production leads to a decrease of approximately 0.30% in grain production areas. Agricultural greenhouse gas emissions, another variable that stands out with its negative impact in ARDL long-run estimation results, indicate that product groups produced as an alternative to grain have a higher emission-generating power. The other long-run estimation results reveal that the tractor variable positively affects grain production areas. Full article

The banking crisis experienced at the beginning of 2023 in the aftermath of the global 2008 crisis served as a stark reminder of the importance of systemic risk once again across the world. This study examines the dynamics of systemic risk in the Turkish banking system and its impact on sustainable economic growth between the period of 2007 and 2022. Through the Component Expected Shortfall (CES) method and quantile spillover analysis, private banks, such as Garanti Bank (GARAN), Akbank (AKBNK), İş Bank (ISCTR), and Yapı ve Kredi Bank (YKBNK), are identified as major sources of systemic risk. The analysis reveals a high level of interconnectedness among the banks during market downturns, with TSKB, Vakıfbank (VAKBNK), İş Bank (ISCTR), Halk Bank (HALKB), Akbank (AKBNK), Yapı ve Kredi Bank (YKBNK), and Garanti Bank (GARAN) serving as net risk transmitters, while QNB Finansbank (QNBFB), ICBC Turkey Bank (ICBCT), Şekerbank (SKBNK), GSD Holding (GSD), and Albaraka Türk (ALBRK) act as net risk receivers. Employing the Markov switching VAR (MS-VAR) model, the study finds that increased systemic risk significantly reduces economic growth during heightened financial periods. These findings underscore the importance of monitoring systemic risks and implementing proactive measures in the banking sector. The policy implications highlight the requirement for regulators and policymakers to prioritize systemic risk management. Close monitoring helps detect weaknesses and imbalances that could put financial stability at risk. Timely implementation of policies and rules is crucial in the prevention of the accumulation of systemic risks and in dealing with the existing hazards. Such measures protect the stability of the banking sector and mitigate potential negative effects on the broader economy. Full article

This study contributes to sustainable finance literature by exemplifying promotion of sustainable finance through fintech solutions for emerging market economies by presenting the case of Turkey. Turkey is one of the largest emerging market economies in the world with a strong banking system and high adoption of technology, so it has great potential to benefit from fintech solutions to boost sustainable finance. For the case analysis, the data used came from a research platform for a Turkish start-up ecosystem, Turkish regulations, and documents released on Turkey’s sustainable finance strategies by Turkish and international institutions. We found that Turkey has made remarkable progress in increasing financial inclusivity for underbanked individuals and SMEs via providing contactless payment and contract systems and microfinance by mobile carriers and other online platforms. Turkey was also able to promote the responsible consumption goal for sustainable development by improving fintech solutions on payment systems with educational content on this goal. With upcoming developments such as the sandbox environment in Istanbul Financial Center, fintech solutions using Big Data, AI, and blockchain could emerge much faster with collaboration between banking and fintech sectors and regulatory institutions to better assess climate-related financial risks and form a national carbon trading mechanism. Full article

Turkey’s e-commerce market is rapidly expanding, and the country is ranked first in the world in monthly mobile purchases. The purpose of this study is to determine the factors that influence the adoption of online payments systems among the customers of a Turkish bank during the COVID-19 pandemic. The research model extends the technology acceptance model (TAM) by further examining the impact of 11 factors on attitude, behavioral intention and actual usage. The results suggest a strong influence of these factors on attitude and behavioral intention. Relative advantage, perceived trust, perceived usefulness, personal innovativeness, perceived integrity, perceived ease of use, health and epidemic effects, income, private sector employment and self-employment all have a positive effect on actual online payment system usage. However, perceived risk and age have a negative impact on the actual online payment system usage. Full article

Regulators in emerging markets are increasingly curtailing the practice of foreigncurrency lending. In such a move Turkish regulatory authorities banned foreign currencylending to households in 2009. This paper examines the evolution of financial dollarization inTurkey in the 2002–2009 period by looking the currency composition of loans and deposits inthe banking system and the macroeconomic developments. We find that the Turkish bankingsystem was unhedged against currency fluctuations and the regulators acted preemptively inbanning the practice. Full article