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Chapter - One: "Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh"
Chapter - One: "Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh"
Chapter - One: "Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh"
Chapter -One
Introduction
“Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh”
1.1 Introduction
Corporate social responsibility means considering the social interest and the world
have realized it in the time of COVID-19 pandemic. Previously every organization
practiced only profit making actions but now the concept has changed. Today every
organization tries to understand that they have some responsibility towards the society
as every person has. The business has social obligations beyond making a profit is
known as corporate social responsibility. Today our society faces a lot of problems
like environmental, social, human rights etc. To overcome these problems the
business should contribute for the society and they have to make policy to improve
the lives of the society. The purpose of the study is to know the CSR practice of
private commercial bank (PCB) in Bangladesh and to identify the major areas they
contribute. CSR is good for the environment, workers and society that is also good for
the organization. So the business needs to be more focused on CSR. As bank collect
money from the society they cannot avoid the responsibility towards society.
The fundamental objective of this research paper is to focus the CSR practices of
different private commercial banks in Bangladesh. The study tries to achieve the
following objectives:
Limitation of this paper is that the officials of different banks did not disclose
specific CSR related data and information for the reason of confidentiality.
Some organization think that by providing information can create problems for
their competitive business world.
The sample of the study is so small. So it is difficult to take the clear concept
about this matter.
“Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh”
concept that enables corporate executives to create and apply self-determined policies
to best meet the needs and demands of its stakeholders. The banking sector in
Bangladesh is showing interest in integrating sustainability into their business models,
but its CSR reporting practices are far from satisfactory. Consequently, this study
focuses on the social impact on the business performance of banks and their
sustainability in the future and made an attempt to analyze CSR practices and CSR
reporting in Bangladesh with special reference to the banking sector (Dhingra, D. &
Mittal, and R. 2014) Dhaliwal et al. (2012) show that CSR disclosures can attract
more analysts and institutional investors and reduce analyst forecast error, prompting
areduction in the cost of equity capital. They suggest that CSR disclosures can be
viewed as a substitute for financial disclosures in terms of improving a firm’s
information environment (Dhaliwal et al. 2014). Lanisand Richardson (2012) show
that higher levels of CSR disclosure are associated with lower tax avoidance,
suggesting increased transparency. However, Cohen et al. (2011) conduct a survey of
retail investors and find that these users do not place great value on CSR information
relative to economic and governance information. In related work, Cheng et al. (2015)
show that investors value CSR only when its measurement pertains closely to the firm
“score strategy.
“Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh”
Chapter- Two
Methodology
“Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh”
To serve the objectives of the study that is the corporate social responsibility of
private commercial banks in Bangladesh and to identify how these banks contribute in
the different CSR areas.
The study is purely based on the information from secondary data sources. The data
are collected from:
Different books, research papers, documents, manuals etc. related to the topic.
The population for the study is that all private commercial banks in Bangladesh. The
researcher has taken eight private commercial banks as their rating system of
Bangladesh bank. The name of these sample banks are shown below:
I have collected data from some private commercial banks. After collecting all data I
analyzed the data individually. I present the data through graph, chart, table etc.
Based on analysis I made findings, recommendations and conclusion.
.
“Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh”
Chapter: Three
CSR Practices in Commercial Bank in
Bangladesh: A Theoretical Review
“Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh”
Corporate social responsibility (CSR) is the corporate initiative to assess and take
responsibility for the company's effects on the environment and impact on social
welfare. The term generally applies to company efforts that go beyond what may be
required by regulators or environmental protection groups.
Companies have a lot of power in the community and in the national economy. They
control a lot of assets, and may have billions in cash at their disposal for socially
conscious investments and programs. Some companies may engage in "green
washing", or feigning interest in corporate responsibility, but many large corporations
are devoting real time and money to environmental sustainability programs,
alternative energy and various social welfare initiatives to benefit employees,
customer, and community at large.
Enormous, nearly unlimited, economic power became centered in the hand of only a
few persons, who became a corporate leader flagrantly, violated the law, and the long
established ethics and morals of business. But after the Industrial Revolution (1800-
1930) a new approach has emerged towards the business and business person.
Arguments from different corners strongly advocate that business activities of human
activity and it could be evaluated from the moral point of view, just as any other
human activity so evaluated. As a result, a specialized area of general ethics named
‘business ethics’ came forward in which an awareness of ethical issues and a
methodical approach to solve them are so important. Some study shows that, the
periods from approximately 1930 to the present brought the re-enlightenment of
business and reestablish the social obligations of business in both society and
governmental regulation to the level that was expected. We observe that over the last
few decades of the twentieth century, Stakeholders (employee, supplier, consumer,
media, government, NGOs, civil society and other social actors etc.) have been
demanding the accountable and responsible role of business towards society and other
social actors. With this ongoing shift of business activities from ‘purely economic’ to
‘economic with an added social dimension’, the term Corporate Social Responsibility
or CSR is now endorsing by scholars and academics worldwide to acknowledge
organizations’ commitment to the society, to their employees and the environment
beside their routine work. In connection with this, we find H.R. Bowen is claimed as
the modern father of corporate social responsibility as in 1953 he first conceptualized
CSR as social obligation- the obligation ‘to pursue those policies, to make those
decisions, or to follow those lines of action which are desirable in terms of objectives
and values of our society’.
I. Sustainability;
II. Accountability;
“Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh”
III. Transparency.
3.3.1 Sustainability
This is concerned with the effect which action taken in the present has upon the
options available in the future. If resources are utilized in the present then they are no
longer available for use in the future, and this is of particular concern if the resources
are finite in quantity.
Thus raw materials of an extractive nature, such as coal, iron or oil, are finite in
quantity and once used are not available for future use. At some point in the future
therefore alternatives will be needed to fulfill the functions currently provided by
these resources. This may be at some point in the relatively distant future but of more
immediate concern is the fact that as resources become depleted then the cost of
acquiring the remaining resources tends to increase, and hence the operational costs of
organizations tend to increase.
Sustainability therefore implies that society must use no more of a resource than can
be regenerated. This can be defined in terms of the carrying capacity of the ecosystem
and described with input – output models of resource consumption. Thus the paper
industry for example has a policy of replanting trees to replace those harvested and
this has the effect of retaining costs in the present rather than temporally externalizing
them.
3.3.2 Accountability
This is concerned with an organization recognizing that its actions affect the external
environment, and therefore assuming responsibility for the effects of its actions. This
concept therefore implies a quantification of the effects of actions taken, both internal
to the organization and externally. More specifically the concept implies a reporting
of those quantifications to all parties affected by those actions. This implies a
“Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh”
This concept therefore implies recognition that the organization is part of a wider
societal network and has responsibilities to that entire network rather than just to the
owners of the organization. Alongside this acceptance of responsibility therefore must
be a recognition that those external stakeholders have the power to affect the way in
which those actions of the organization are taken and a role in deciding whether or not
such actions can be justified, and if so at what cost to the organization and to other
stakeholders.
3.3.3 Transparency
Transparency, as a principle, means that the external impact of the actions of the
organization can be ascertained from that organization’s reporting and pertinent facts
are not disguised within that reporting. Thus all the effects of the actions of the
organization, including external impacts, should be apparent to all from using the
information provided by the organization’s reporting mechanisms. Transparency is of
particular importance to external users of such information as these users lack the
background details and knowledge available to internal users of such information.
Transparency therefore can be seen to follow from the other two principles and
equally can be seen to be a part of the process of recognition of responsibility on the
part of the organization for the external effects of its actions and equally part of the
process of transferring power to external stakeholders.
“Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh”
Chapter- Four
All commercial banks in Bangladesh undertake the CSR program in recent time.
These activities have a huge impact in the social & economic development of our
country. As we have taken eight banking institutions including 8 PCB’s as sample.
The contributions of those eight sample banks are described in this section.
Chapter 5
5.1.1 Education
700
600
500
400 2015
2016
300 2017
2018
200 2019
100
0
DBBL TBL BAL SIBL SEBL IBBL MBL OBL
“Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh”
5.1.2 Health
600
500
400
300
200
100
0
DBBL TBL BAL SIBL SEBL IBBL MBL OBL
25
20
15
10
0
DBBL TBL BAL SIBL SEBL IBBL MBL OBL
5.1.6 Environment
“Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh”
25
20
15
10
0
DBBL TBL BAL SIBL SEBL IBBL MBL OBL
5.1.7 Miscellaneous
100
80
60
40
20
0
DBBL TBL BAL SIBL SEBL IBBL MBL OBL
It has already been mentioned that there are 22 CSR contribution areas where an
organization could enjoy 10% tax rebate. However, those table exhibits the
compliance of CSR practiced by commercial banks in Bangladesh with the regulatory
framework.
S. CSR Areas DBBL TBL BAL SIBL SEBL IBBL MBL OBL
L
1 Engaged in clean - - - - - - -
water management
2 Engaged in - - - - - - - -
afforestation
3 Beautifications of - - - -
cities
4 Waste management - - - - - - -
5 Natural calamities
7 Mentally or physically - - - -
handicapped
8 Education of rootless - - -
children
9 Accommodation for - - - - - - - -
the slum dwellers
anti-dowry practices
11 Rehabilitation of - - - -
orphan/rootless
children
12 In research on -
independence war,
regaining and
expansion of the
consciousness of the
independence war and
the act of honorable
living of the freedom
fighters
14 Engaged in treating - -
cleft lips, cataract,
cancer, and leprosy
15 Engaged in treating - - - - - - -
acid victims
16 Hospitals engaged in
providing free medical
treatment to poor
patients
18 Grants to Public - -
Universities
19 Technical and - - -
vocational education
for meritorious poor
students
20 Training on computer - - - - - -
or information
technology and in
establishing
infrastructure or in
purchasing educational
materials for
implementing English
education in
public/private
educational
institutions (under
Monthly Pay Order or
MPO)
21 Technical and - - - - - - - -
vocational training to
unskilled or
semiskilled labor for
export of human
“Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh”
resources
Total 14 9 11 6 8 11 9 5
“Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh”
Chapter 6
Findings, Recommendation
&Conclusion
“Corporate Social Responsibility Practices in Commercial Banking Sector in Bangladesh”
6.1 Findings
6.2 Recommendation
6.3 Conclusion