E3S Web Conf.
Volume 349, 202210th International Conference on Life Cycle Management (LCM 2021)
|Number of page(s)||6|
|Section||Life Cycle Management and Sustainable Business|
|Published online||20 May 2022|
Rating, Credit Decision and Pricing - How Sustainability and Life Cycle Assessments are Changing Credit Practice
msg GillardonBSM AG, 60549 Frankfurt am Main, Germany
2 Fraunhofer Institute for Building Physics IBP, 70569 Stuttgart, Germany
* Corresponding author: firstname.lastname@example.org
Investment decisions by bank customers are increasingly linked to the demand for green investments. Without a meaningful life-cycle costing approach, the danger remains that both bank and customer are exposed to the risk of green washing. The same applies to lending decisions: here, the bank must ultimately assess the business model of the borrower as well as the subject of the loan. Without monetary integration of environmental indicators, the existing rating systems lose their ability to make accurate assessments of creditworthiness. Investment objects like real estate would be assessed with incorrect market values and, accordingly, the lending decision would be based on inadequate data. Based on this, the practice of lending is facing considerable adjustments.
© The Authors, published by EDP Sciences, 2022
This is an Open Access article distributed under the terms of the Creative Commons Attribution License 4.0, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
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