The Role of Commercial Banks in Promoting Sustainable Development

Over the past decades, Sustainable Development issues have become an important decision-making factor and a key focus area for many private institutions, individuals or governments.The modern world is faced with increasingly negative consequences of climate change. At the same time, mitigation and adaptation efforts as well as financial resources allocated for them do not correspond the scope and intensity of record-breaking extreme weather events already occurring.Commercial banks, in general, are well aware that the negative consequences of a climate change pose significant direct or indirect impact to their core business as well as companies they invest in. By integrating environmental, social and governance (ESG) considerations in the business strategy and offering sustainable finance products, financial institutions are ensuring long-term investments in sustainable economics as well as promoting positive changes.This report analyzes how the banking sector can contribute to sustainable development in developing countries, specifically in the context of Georgia. The paper also highlights the main challenges and opportunities related to sustainability issues in the banking and provides several suggestions that can help improve the sustainable ecosystem in Georgia.