In the transition to sustainable banking, improving the financial performance of banks requires a review of operational structures and macro-policies. The present study, with the aim of providing a dynamic model for improving financial performance in sustainable banking conditions, has designed, simulated, and analyzed a system dynamics model in the banking system. The proposed model, focusing on ROA, ROE, retained earnings, deposit attraction, and investment in technology, presents a causal and behavioral structure that dynamically represents the interactions between financial, social, and environmental variables in the period 1397 to 1403.
Simulation of the model in the period 1404 to 1410 showed that implementing sustainable policies led to significant improvements in bank performance indicators and paved the way for improving financial performance. In the scenario section, three main policies were examined, including financing advanced technologies, developing green facilities, and increasing the government's commitment to ESG principles. The results showed that each of these policies has different effects on the performance dimensions of the bank and their combination creates the greatest synergistic effect. The sensitivity analysis of the model also indicated the appropriate responsiveness of the indicators to policy stimuli.
The research findings are in line with previous studies in the field of sustainable banking and at the same time, it has presented innovations such as explicit modeling of ESG indicators, dynamic definition of customer trust and design of multi-layer feedback loops. The proposed model can be used as a strategic tool for formulating operational strategies, assessing future scenarios and making macro-decisions in the Iranian banking system.