Evaluation of branch-level green banking in Bangladesh through life cycle assessment approach
Year: 2025
Type: article
Abstract: Green banking becoming an everyday practice around the globe and similar to developing nations like Bangladesh, this study embarks on an ambition to assess the environmental burden of the banking sector. Leveraging Life Cycle Assessment (LCA), a methodology widely used for environmental footprint assessment delves into the resource utilization, waste generation, and overall environmental emissions of Bangladeshi banking systems. This national inventory will not only compare the environmental performances of urban vs. rural and private vs. public banks but also serve as a crucial stepping stone for future research in sustainable banking practices. Overall, this study aims to help policymakers and financial institutions with substantial insights, guiding them to thrive in their operation in a direction where economic prosperity and environmental sustainability are in harmony. This study follows the ISO guideline to conduct LCA of the banking system in Bangladesh at different branch levels. The total deposit of money per year in million BDT is considered a functional unit and activities within the country are considered. In the assessment, OpenLCA is used for modeling while ReCiPe-2008 is used for assessing the lifecycle impact of the entire process. The study results reveal that Marine ecotoxicity is the primary contributor (1.1 kg 1,4 -DCB) to the overall banking system in Bangladesh, followed by freshwater ecotoxicity (0.81 kg 1,4-DCB) and Human carcinogenic toxicity (0.61 kg 1,4-DCB. However, the Global warming potential is identified as 27.22 kg CO2-eq for every million BDT deposited in an economic year. The hotspot analysis of the study indicates that in most impact categories, electricity production has the most significant environmental footprint. However, computer use and fossil fuel production play a noteworthy role in the categories of human non-carcinogenic toxicity and fossil resource depletion, because of their wide range of materials used in production. The study concludes that public and rural commercial banks poses more loopholes to improve for greener banking practices as public banks and rural branches serve more customers with fewer facilities over a large area.
Source: Discover Applied Sciences
Institution: University of Chittagong
Language: English
Subfield: Environmental Engineering
Field: Environmental Science
Domain: Physical Sciences
Open Access status: diamond
OpenAlex ID: W4412366472