Study of Green Banking Practices in the Sri Lankan Context: A Critical Review

Abstract

In Sri Lanka, banking industry can be considered as a monopolistic competitive market. Therefore,

both public and private sector banks are following a range of non-price competitive strategies in

order to win the market. In this context, the concept of green banking is becoming a novel

technology oriented strategic initiative for Sri Lankan banks to achieve triple bottom line business

results. Under this circumstances, the banks are basically introducing paperless and information

technology oriented banking services to their existing and prospective customers while promoting

the banks’ role as a responsible corporate citizen towards achieving sustainable development. The

core strategy used in this scenario is the usage of the term “green banking” as a brand positioning

factor where above mentioned set of paperless and information technology oriented banking

services are introduced to its customers. Through this innovation the banks are able to gain cost

effective advantages rather than contributing to the environmental sustainability. Therefore, this

paper is critically reviewing the above scenario by using case study approach while addressing to

the basic question as whether the current green banking initiatives used by Sri Lankan banking

sector are truly contributing to the environmental sustainability or not. The authors are exploring

the above phenomena through a conceptual model and suggest realistic solutions to convert the

Green Banking Strategies to achieve long term sustainable development of both the banking sector

and the environment.