Who really drives the claim? Third-party funding and the future of investment arbitration

The implementation of Basel III regulations has become a crucial factor influencing the financial performance of the banking sector in Bangladesh. The primary objective of this study is to examine the impact of Basel III implementation on the financial performance of the banking industry in Bangladesh. The research utilizes secondary data from 20 commercial banks in Bangladesh, including state-owned, private, and Islamic banks. It offers a diverse and representative sample of Bangladesh’s banking sector, covering the period from 2014 to 2023. This variety ensures a comprehensive understanding of different banking models and their challenges, representing the scenario of the whole industry. A multivariate regression model with fixed effects, determined by the Hausman test, was employed to analyze the relationship between capital adequacy (CRAR, Core Capital Tier-1, Tier-1, and Tier-2 Capital Ratios) and bank-specific factors (size, provisions) on performance indicators (ROA and NPL). The findings reveal that higher capital adequacy, particularly the Tier-1 Capital Ratio, and CRAR, positively influences bank profitability (measured by ROA) and reduces NPLs. Conversely, larger bank size correlates with lower ROA and higher NPLs, and increased provisions also lead to higher NPLs. These results underscore the significance of Basel III in enhancing the financial performance and stability of the banking sector in Bangladesh, suggesting that more substantial capital buffers can improve profitability and reduce risks associated with non-performing loans.

Type of the article: Research Article

Abstract
This study investigates the impact of greenwashing in ESG disclosure on firms’ ability to create shared value (CSV) by focusing on the mediating roles of disclosure quality and information asymmetry across different institutional contexts. The analysis is based on 391 firm-year observations of non-financial companies listed in Indonesia (277) and Malaysia (114) from 2018 to 2023, based on annual reports, sustainability disclosures, and Refinitiv ESG data. Random-effects panel regressions and bootstrapped mediation tests were used to evaluate direct and indirect effects. The results showed that greenwashing does not exert a significant direct influence on CSV in either country. However, in Malaysia, greenwashing significantly reduces information quality, which, in turn, undermines shared-value creation (indirect effect is significant). In Indonesia, although greenwashing negatively affects information quality, the subsequent link between disclosure quality and CSV is insignificant, resulting in no mediation effect. ESG disclosure quality, as a proxy for information asymmetry, does not mediate the greenwashing–CSV relationship in either country. These findings highlight the cross-country differences shaped by institutional environments: stronger regulatory oversight and stakeholder scrutiny in Malaysia amplify the mediating role of disclosure credibility, whereas weaker governance in Indonesia attenuates its relevance. This study contributes to the sustainability accounting literature by integrating symbolic compliance theory with the CSV framework and provides evidence that the credibility of ESG information is a critical determinant of value creation in emerging economies.

Acknowledgment
We express our gratitude to the Faculty of Economics and Business, Universitas Brawijaya, Indonesia, and the Faculty of Business and Economics, Universiti Malaya, Malaysia, for supporting this research collaboration.

The increasing role of digitalization in the banking sector necessitates an in-depth analysis of the impact of information technology (IT) investments on bank profitability. The paper analyzes the influence of IT investments on the profitability of Vietnamese commercial banks. The data were collected from 27 commercial banks in Vietnam between 2010 and 2022. The methodology used in this paper is the Feasible Generalised Least Squares (FGLS) regression. The key results indicate that investment in IT has improved the overall performance of banks, as evidenced by an average increase of 1.8% in Return on Assets (ROA) and 15.3% in Return on Equity (ROE). In addition, the Equity-to-Asset ratio exerts a favorable influence on bank performance, increasing ROA by 15.7% and ROE by 40.9%. Furthermore, bank size also demonstrates a positive correlation with both ROA and ROE, raising it by 0.3% and 2.3%, respectively. Based on these findings, more efficient investment in digital transformation, collaboration with Fintech firms, IT competence enhancement for staff, and communication promotion for Vietnamese commercial banks are recommended. Enabling environments for bank digital transformation should be provided by the Government in building a centralized database and electronic systems, introducing fintech regulations, establishing digital ecosystems, and implementing security solutions.

Acknowlegment
This paper is funded by the National Economics University, Hanoi, Vietnam.
The authors would like to express their gratitude to the comments from chairs, scholars, and audiences at the 19th International Conference on Humanities & Social Sciences 2024 – Applying Humanities & Social Sciences for a sustainable future, Khonkhaen University, Thailand (ICHUSO-011). This paper has been revised significantly after presenting at the IC-HUSO 2024 Conference.