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1874. Financing the circular economy: effects on bank risk management
Invited abstract in session TD-63: New Challenges for Risk Management , stream OR in Banking, Finance and Insurance: New Tools for Risk Management.
Tuesday, 14:30-16:00Room: S14 (building: 101)
Authors (first author is the speaker)
| 1. | Nadia Ricci
|
| DII-Management, Università degli studi di Padova-Università Politecnica delle Marche | |
| 2. | Caterina Lucarelli
|
| Department of Management, Università Politecnica Marche | |
| 3. | Pietro Vozzella
|
| Management, Università politecnica delle Marche |
Abstract
The circular economy encourages a move away from the traditional linear corporate approach to production and consumption in favor of integrated systems with external connections and in which materials circulate in a closed circular loop leading to substantial improvements in resource efficiency, energy savings and achievement of sustainability goals. In this transitional process, access to bank financing for firms is a key challenge not only in the perspective of circular businesses but also in the perspective of banks which must consider new factors that may influence the creditworthiness evaluation process with an impact on risk management. Consequently, circular businesses and banks are linked in a new systemic and complex approach both in practice and in academic literature. The aim of this research is to explore this twofold area and understand its main characteristics in order to develop future research on this topic. To achieve this objective we developed a conceptual framework that guided a literature review based on a selection of 42 articles explored through a bibliometric and thematic analysis. Our results confirm the complexity of the relationship between circular businesses and banks: in the implementation process circular businesses are mainly faced with financial barriers; banks do not consider the impact of circularity factors in assessing credit risk and default probability of circular businesses; there is a need for banks to shift from a shareholder vision.
Keywords
- Finance and Banking
- Risk Analysis and Management
- OR in Sustainability
Status: accepted
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