Research purpose: This paper critically reviews Vietnam’s evolving legal framework for sustainable development in commercial banking, examining how primary statutes and SBV instruments translate sustainability objectives into governance, risk, and disclosure practice, and how they align with international standards.
Research motivation: As Vietnamese banks face simultaneous domestic mandates and global market expectations, a clear view of legal strengths, gaps, and convergence pathways is needed to support credible implementation and investor confidence.
Research design, approach, and method: The study adopts a qualitative, theory-informed approach grounded in stakeholder, legitimacy, and institutional theories. Guided by these perspectives, it synthesizes core legal and policy instruments and benchmarks Vietnam’s direction of travel against widely recognized international reference points. A structured set of comparative dimensions is applied to organize evidence on scope, governance, process discipline, risk integration, disclosure architecture, and implementation.
Main findings: Vietnam shows substantial progress toward a coherent, enforceable framework that aligns sustainability objectives with banking practice. The analysis indicates broad convergence with international expectations alongside features tailored to domestic priorities. At the same time, the framework would benefit from clearer common definitions, more consistent market-facing disclosures, stronger links between engagement evidence and risk decisions, and continued capacity development to support practical implementation.
Practical implications: In light of the identified gaps, actions should be sequenced and audience-specific. Policymakers should first strengthen the legal foundations and the shared data environment, so that definitions are clear and information flows are reliable. Regulators should then convert those foundations into consistent supervisory tools, including standardized templates, reporting formats, and proportionate guidance, all of which support implementation without creating duplicative burdens. Practitioners should in turn embed the resulting requirements into governance, credit processes, and internal controls, ensuring that disclosures reflect real risk decisions rather than after-the-fact narratives.