Enhancing Operational Excellence: Exploring the interplay of ESG Reporting, Smart Technology Adoption, and Total Quality Management in the banking sector

Details

Supervisors

Olieslagers, Ruben

Faculty

Louvain School of Management

Degree label

Master [120] : ingénieur de gestion, à finalité spécialisée

Abstract

This study focuses on the significant transformation occurring within the banking sector driven by the need for robust ESG practices, the adoption of smart technologies, and more restrictive non-financial reporting requirements. It examines the interplay between ESG reporting, Total Quality Management (TQM), and Smart Technology Adoption (STA) in light of the new Corporate Sustainability Reporting Directive (CSRD). This research also explores the differences between theoretical frameworks and their actual implementation in the banking sector. Insights into how banks can enhance their operational efficiency, regulatory compliance, customer satisfaction, and overall sustainability practices are provided in this study. It investigates the potential interconnections between STA, TQM, and ESG Reporting to determine whether leveraging them together can lead to operational excellence and mutual improvements. This was achieved through multiple steps. First, a detailed literature review was performed. Next, semi-structured interviews were conducted with experts in ESG Reporting, Quality Management, and Digital Transformation. Finally, a statistical analysis was carried out using data gathered from questionnaires distributed to banking professionals. Several implications result from the findings. It suggests that banks should invest in advanced digital tools such as AI and BDA for the building of their reports, as well as for comparing themselves with competitors’ reports. However, in the early years of CSRD implementation, focusing on TQM principles might be more practical and cost-effective for banks. Emphasising TQM practices across various departments can indeed enhance the overall quality management strategy, as indicated by the significantly positive impact of TQM on ESG reporting. Finally, banks should also leverage AI-powered CRM systems and data analytics to foster a culture of continuous improvement and employee engagement. These findings are crucial for ensuring higher standards of ESG reporting and operational efficiency across the banking sector. Advanced technologies can streamline data collection, enhance accuracy, and improve the quality of ESG reports. Moreover, they can assist with benchmarking and report writing, enabling banks to refine their ESG Reporting quality and comparability. Ultimately, these improvements contribute to better customer satisfaction and overall operational excellence.