Corruption in least developed countries and ESG (responsible) investment: Standard Chartered Bank in Nepal
Journal of Financial Regulation and Compliance
ISSN: 1358-1988
Article publication date: 29 February 2024
Abstract
Purpose
This study aims to explore the effects of responsible international investment in a least developed country (LDC) on ethics and corruption in the local industry. While investment growth in least developed countries (LDCs) is essential to meet the United Nations Sustainable Development Goals, international investment in LDCs poses challenges, including corruption. The authors explore perspectives from relevant stakeholders on the influence, if any, on an LDC’s banking sector, of investment in the LDC by a multinational bank with an environmental, social and governance focus – using a case study of Standard Chartered Bank (SCB) in Nepal.
Design/methodology/approach
The authors conducted thematic analysis on: focus groups with current and former SCB Nepal management; semi-structured interviews with Nepal banking regulator representatives; senior staff from SCB global divisions; and management of other commercial banks in Nepal.
Findings
Knowledge transfer, organisational enablers and constructive international competition contributed to the dissemination of best practices within the Nepal banking sector, supporting the notion of beneficial spill-over effects of multinationals on LDC host countries.
Practical implications
Practical insights will aid LDC governments, international businesses, investment funds and donor organisations seeking to invest in/assist LDCs with economic development.
Originality/value
To the best of the authors’ knowledge, this may be the first case study on ethics and anti-corruption practices of a multinational bank in a LDC. Through a practice-driven focus, the authors provide “on-the-ground” insights to better understand the complex nature of corruption.
Keywords
Acknowledgements
The authors wish to thank Joseph Silvanus, Anil K. Shah, Parshuram Kunwar Chhetri, Ajay Shrestha, Deepak Rajbhandary, Sanjay Pant, Anirvan Ghosh Dastidar, Pranu Singh, Rajkamal Basnet and Sriprasad Bhandari for their invaluable contributions. The authors also thank Standard Chartered Bank in the United Kingdom and in Nepal for the access granted.
Declaration of interest: The second, third and fourth authors declare that they have no financial or non-financial interests that are relevant to the content of this paper. The first author has no direct financial or non-financial interests in Standard Chartered Bank or any of the organisations involved in the study. The first author is the CEO of Dolma Fund Management, which manages two private equity funds that invest in Nepal. The funds have eight direct or indirect holdings in renewable energy projects, healthcare companies and ICT companies, some of which have loans from banks in Nepal. However, the funds have no holdings, direct or indirect, in any banks in Nepal.
Funding: This research did not receive any grant from funding agencies in the public, commercial or not-for-profit sectors.
Ethics approval: Approval for this study was granted by the Nottingham University Business School Malaysia Research Ethics Committee (Ref. NUBS-REC-2020-15).
Citation
Gocher, T., Chan, W.L., Ramachandran, J. and Yee, A.S.V. (2024), "Corruption in least developed countries and ESG (responsible) investment: Standard Chartered Bank in Nepal", Journal of Financial Regulation and Compliance, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/JFRC-07-2023-0112
Publisher
:Emerald Publishing Limited
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