Bridging ESG and FinTech: The role of green innovation, board expertise, and governance in global banks

Purpose: The study examines the intricate relationships among Environmental, Social, and Governance (ESG) factors, Financial Technology (FinTech), board-specific skills, and audit committee expertise. It also assesses how green innovation and board gender diversity influence these relationships. Design/Methodology: The study utilizes a global dataset comprising 3744 financial institutions (initial 93,600 firm-year observations) across 83 countries from 1999 to 2023. Using baseline regression models, such as the fixed-effect model, after incorporating the Hausman test. Further, the study used the Panel Corrected Standard Error (PCSE) and Driscoll–Kraay models for robustness analysis to address heteroscedasticity, autocorrelation, and cross-sectional dependence. Moreover, heterogeneity analyses of high and low board size and of independent members, as well as industry/sector analyses, have been employed. Findings: Fixed-effects results indicate that Fintech has a positive relationship with ESG performance through improved transparency, information flow, and stakeholder confidence, consistent with stakeholder theory and the resource-based view. Further, board gender diversity strengthens this relationship, enhances intangible governance resources that enable firms to implement FinTech capabilities into ESG performance more effectively, and reduces agency conflicts. At the same time, knowledge-sharing indicators, such as board-specific skills and audit committee expertise, positively impact ESG performance across emerging, developed, and low-income markets. Moreover, the results of PCSE and Driscoll–Kraay indicated that the results are significant and align with our baseline regression model. Originality: This study demonstrates the impact of technological advancement on the long-term value behavior of corporate organizations, serving as a reference for both emerging and developed countries seeking to promote green and economic development.