Business stakeholders are becoming more involved in environmental, social, and governance
(ESG) aspects. There is an increasing awareness in the financial services industry
of the importance of incorporating ESG factors into strategies, processes, and financial
tools to generate value over the medium and long run. While a vast body of literature
examines the connection between ESG factors and company performance, only a few studies
have specifically investigated the financial services industry, often employing linear
models. This research specifically examines the ESG performance of the financial services
industry. It utilizes a life-cycle framework to analyze the patterns and relationships
of European companies in the sector. This analysis is conducted using linear panel
regression models. The study's conclusions serve as crucial benchmarks for investment
managers and policymakers. The findings illustrate that superior, enhanced ESG performance
can bolster the financial success of industry participants.
