the role of banks in process of sustainable development and sustainable banking practices in turkey

Abstract

After environmental and social problems such as seasonal changes, natural resources at the verge of extinction, decrease in plant diversity, unemployment and poverty are started to be felt globally, sustainable development approach began to substitute the approach focusing only on the economical development in 1970s. Sustainable development covers environmental and social sustainability elementsbesides economical development. Companies, financial sector, nongovernmental organizations, particularly states and all other groups are responsible in this sustainable development process. However awareness on environmental and social issues in financial sector undergone a far slower development compared to the other sectors due to fact that it regarded itself as an environment-friendly sector. Since 1990s, it has began to accepted by a wide proportion that financial institutions take into consideration social and environmental results besides the economical effects and they should take an effective role in the sustainable development process. Today it is seen that sustainable finance approach is adopted by many financial institutions especially in developed countries. In eveloping countries, lack of legal arrangements, unstable sustainable development policies, financial institutions' lack of knowledge in sustainable finance and lace of public awareness on sustainable development issue stand out as the reasons preventing the development of sustainable finance understanding.