The linkage between the financial performance of microfinance institutions (MFIs) and comprehensive ESG (Environmental, Social and Governance) performance has been ignored by researchers till date albeit this tie may serve as a primary objective for MFIs. This paper aimed at studying whether ESG performance influence MFIs' financial performance based on an annual dataset covering 5 years, 34 countries and 62 MFIs. Econometric evidence of panel data analysis reveals that ESG performance positively affects financial performance for the periods under review yet sub-models (of ESG) documented mixed results ...

The spotlight of this study is to examine whether environmental, social, and governance performance affects the financial performance of microfinance institutions (MFIs). The topic has been of much interest to researchers and policymakers due to increased awareness among stakeholders on the adverse social and environmental impacts of business actions. Using a dataset covering 5 years for 62 MFIs across 34 countries, we find that environmental and governance performance has no impact on the financial performance of MFIs. As for the social-financial performance nexus, our results reveal a positive relationship using the depth of outreach as proxy of social performance. However, when women empowerment is used as a proxy for social performance, evidence suggest presence of negative relationship. The study contributes to the literature by providing new evidence on the relationship between environmental, social, and governance and financial performance from microfinance industry. Our results are robust to a variety of econometric specifications and have significant policy implications for donors, investors, MFIs, and regulators.

This study explores the practical application of the Shariah screening process and how it could be enhanced by converging the same with the ethical screening of stocks. This study adopts a qualitative research methodology by combining the qualitative descriptive approach and content analysis. The findings of this research suggest that there is scope to converge ethical screening of stocks with Shariah Screening as the lex loci applicable to Shariah screening is derived from Shariah, which considers ethics as part of determining its rules. The data from this study reveal several practical applications, the ultimate goal of which is to help the policymakers and stakeholders understand the relevance of the Shariah screening of stocks and get a streamlined screening process, paving the way to enhance the same using ethical screening criteria to develop its function to become much more relevant irrespective of the denomination of faiths. This is original research, which is expected to contribute to understanding the extent to which Shariah screening can be enhanced by integrating the ethical stock screening dimension to it.