Corporate Social Responsibility and Bank Credit Ratings

This paper examines the association between bank credit ratings and corporate social responsibility (CSR). The sample includes large publicly listed banks in the United States during fiscal years 2000–2016. Our findings indicate that CSR policies positively affect banks’ credit ratings. We further test each dimension of the MSCI KLD database’s ESG ratings and find that the CSR components measuring diversity and employee relations are particularly relevant in the credit rating context.