ESG Implementation in Vietnam Banking sector: Perspective from the legal framework

Abstract

The comprehensive implementation of ESG (Environmental, Social, and Governance) not only helps the banking sector develop more sustainably but also contributes to creating momentum for the Vietnam economy in moving towards green and sustainable financial standards in line with international trends. This research paper analyzes the implementation of ESG in Vietnam banking sector from a legal framework perspective. The article provides an overview of current policies, regulations, and orientations related to ESG, clarifies legal barriers as well as potential opportunities that ESG brings to the Vietnam banking sector. In addition, the paper also analyzes the challenges in the ESG implementation process in Vietnam, especially the lack of consistency in legal regulations, difficulties in measuring ESG impacts, and limitations in the implementation capacity of credit institutions. Finally, the research paper offers some policy recommendations to improve the legal framework, build an effective monitoring mechanism, and promote green credit policies.