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CHAPTER 1

INTRODUCTION

1.1 Overview
This is the time of industrialization and commercialization of the entire service
sector. All the Companies are moving forward for the profit maximization and
the profit which they are gaining it is from the society so the companies must
take it as obligation towards the society which is to be repaid in terms of social
banking towards the benefit of society. This social Banking means to contribute
for the society while conducting the work within the boundary of ethics and that
is called Corporate Social Responsibility. The CSR practices have been started a
long time ago but in India its speed of implementation were very slow. At
present there is an increasing awareness about CSR, Sustainable Development
and Non-Financial Reporting, the credit goes to RBI in focusing the CSR
practices in Indian Banking Sector, by passing a circular in the year 2007,
December, directed banks to undertake CSR initiatives for sustainable
development.

1.2 PHASES OF CSR PRACTICES IN INDIA


[1] According to Michael Hopkins (2003), CSR is concerned with treating the
internal and external stakeholders of the firm ethically or in a socially
responsible manner and the wider aim of corporate social responsibility is to
create higher and higher standards of living, while preserving the profitability of
the corporation, for its stakeholders.

[2] The CSR phases as its development can be divided in to four phases are as
follows:
Phase
Phase I

Key Thrust
CSR motivated by charity

Key Strategy
The oldest form of CSR was motivated by

(Till 1914)

and philanthropy

charity and philanthropy with direct


influence from culture, religion, family

Phase II

CSR for Indias social

tradition, and industrialization process.


Dominated by the countrys struggle for

(Till 1914-1960)

development.

independence and
influenced fundamentally by Gandhis
theory of trusteeship for consolidation and
amplification of social development.
Gandhis reform programs which included
activities that sought in particular abolition
of untouchability, womens empowerment

Phase III

CSR under the paradigm of

and rural development.


The paradigm of mixed economy with the

(Till 1960-1980)

the mixed economy

emergence of legislation on labor and


Environmental standards, affected the third
phase of Indian CSR This phase Is also
characterized by a shift from corporate self
regulation to strict legal and public

Phase IV

CSR at the Interface

regulation of business activities.


Indian companies and stakeholders began

(Till 1980

between philanthropic and

abandoning traditional philanthropic

onwards)

business approaches

engagement and, to some extent, integrated


CSR into a coherent and sustainable
business strategy, partly adopting the multi
stakeholder approach.

1.3 OBJECTIVE OF THE STUDY


The Present study aims to evaluate the different dimensions of Corporate Social
Responsibility by studying the following Objectives:
o To Study the concept of CSR;
o To Study the Major areas of CSR initiatives in Indian Banking Sector.
o To Study the CSR Reporting Practices in Indian Financial Sector
. o To Focus on the Present Status of CSR in Banking.

1.4 METHODOLOGY
Research methodology is the blue print of the research which is going to be
conducted. The Research design in this study is Descriptive research design,
Random Sampling technique is used for selecting the Banks for this Study in
which the major players two from Public Sector and two from Private Sector
have been selected for the study i.e. SBI,PNB,HDFC and ICICI. The Data is
collected from secondary sources particularly from concerned Banks Annual
Report, Web sites, newsletters and data from various journals. The concept of
corporate Social Responsibility (CSR) is not a new one. But its focal point
changes with the changing requirements of business and varying social needs
Corporate Social Responsibility recognizes that business firms have not one but
many different kinds of responsibility, including economic and legal
responsibility. In 1960, CSR surfaced as an attempt to link business with society.

The underlying belief in this era was to apply the resources in a socially
responsible manner i.e., the promotion of social welfare along with the
economic development. The main argument was to employ economys means of
production in such a way that production and distribution could enhance total
socio-economic welfare.

1.5 LITRETURE REVIEW


The Commission defines corporate social responsibility as the responsibility of
enterprises for their impacts on society. To fully meet their social responsibility,
enterprises should have in place a process to integrate social, environmental,
ethical human rights and consumer concerns into their business operations and
core strategy in close collaboration with their stakeholders
According to Bert Scholtens, finance relates to the sustainability of economic
development and to CSR. The three financing modes open the potential to direct
the economic activities in a way that takes account of social, ethical, and
environmental issues.
According to Jacob M. Rose, in his study findings indicate that directors employ
prospective rationality cognition, and they sometimes make decisions that
emphasize legal defensibility at the expense of personal ethics and social
responsibility. The results suggest that additional ethics education will have little
influence on the decisions of many business leaders because their decisions are
driven by corporate law, rather than personal ethics.
Paul C. Godfrey and Nile W. Hatch they studied on the two aspects one;
Examination of the marginal utility of various CSRs by firms. Second,
researchers must focus their tools on individual firm-stakeholder

Md. Habib-Uz-Zaman Khan suggests that the effects of corporate governance


(CG) elements on CSR disclosures in reporting information of Bangladeshi
listed commercial banks are high. Non-executive directors and existence of
foreign nationalities have been found the significant impact on the CSR
reporting
Sanjay Kanti Das (2012),in his study presented that development of Corporate
Social Responsibility (CSR) is very slowly in India though it was started a long
time ago. In his view CSR has been assuming greater importance in the
corporate world, including the banking sector. There is a visible trend in the
financial sector of promoting International Journal of Scientific and Research
Publications, Volume 3, Issue 12, December 2013 3 ISSN 2250-3153
www.ijsrp.org environment friendly and socially responsible lending and
investment practices. The Govt. of India is pursuing the matter relating to CSR
and also drafted guidelines for CSR practices time to time
Suman

Kalyan

Chaudhury,

Sanjay

Kanti

Das,

Prasanta

Kumar

Sahoo(2011),said in their study that, At present, the world over, there is an


increasing awareness about Corporate Social Responsibility (CSR), Sustainable
Development (SD) and Non- Financial Reporting (NFR). The contribution of
financial institutions including banks to sustainable development is paramount,
considering the crucial role they play in financing the economic and
developmental activities of the world.

CHAPTER 2
CSR INITIATIVES BY BANKING SECTOR
2. 1Major Areas of CSR Along With Their Expenditure on CSR
Activities
(a) State Bank of India:
Corporate Social Responsibility has always been a part of the State Bank of
India covering various social, environmental and welfare activities. Their pledge
towards CSR is reflected in their CSR vision statement (Serving the
Community Everywhere)
The comparative chart of CSR spends for the last three years is as under (in
crores)

CSR Activities
National Donations

2009-2010
5.15

2010-2011
2.00

2011-2012
5.50

direct 14.57

22.44

65.68

19.72

22.44

71.18

(To provide succor to victims of natural


calamities)
Normal Donations

&

other

activities
Total CSR spend
For the first time in the last decade, the
budget

For

CSR

spend

(normal

donations and other direct activities) has


been

surpassed

even

though

the

allocation was much higher than the


previous years.

Table no. -1 (source SBI annual report)

By analyzing the table no.1 we can see that in the year 2009 the expenditure of
bank in different CSR activities were 19.72 crores which is increased in the year
2012 up to 71.18 crores ,which is the good symbol for the Indian Economy.

Sector wise Deployment


The breakup of sectoral deployment of SBIs CSR spends during the
year has been as under:

CSR Activities
National Donations
Supporting Education
Supporting Healthcare
Assistance to underprivileged

Amount (` in crores)
5.50
38.33
15.03
5.37

Supporting Culture
Research & Development
Environment Protection
Other projects
Total

1.75
3.75
0.67
1.38
71.18

Table no. -2 (source SBI annual report)


b) Punjab National Bank
PNB is also a big player of Banking Sector under Public Sector which has
contributed in a lot in CSR strategies like Sustainability, Corporate volunteering,
social investment, health, collaboration, and green initiatives. At the march
2011, credit to Micro Small & Medium Enterprises sector stood at RS 45, 296
crores. Bank has financed 6400 rickshaw amount disbursed was RS 629 lakh in
the year 2010. This Bank has been awarded Golden Peacock Award for CSR
for the year 2011 by Institute of Director (IOD).

Priority Sector Credit (As on last reporting of March 2011)

ICICI Foundation

Amount (Millions)

Programmes CSO Partners


Digantar Shiksha Evam Khelkud Samiti
Tata Institute of Social Sciences
The America India Foundation Trust
Eklavya Foundation
Jana Sanskriti Centre for Theatre of the

10
12.28
9.56
3.00
6.52
2.08

Oppressed
Vikramshila Education Resource Society
Centre for Learning Resources
Janagraaha Education Support Organisation

2.00
1.81
1.63

Save the Children


Other Grants / Project Expenses

0.90
1.10

ICICI Group CSR


Give India - ICICI Bank Read to Lead Project

26.59

Dignity Foundation

25.00

Bhavishya Alliance

1.61

Give India Speak for Smiles

7.00

TOTAL

112.93

Table no. - 4 (source ICICI annual report)

CHAPTER 3
REPORTING OF CSR PRACTICES BY INDIAN
FINANCIAL INSTITUTIONS
The concept of CSR reporting has been described by different scholars in
different ways.CSR reporting calls for reflection of corporate ethical practices,
transparency, sensitivity to the environment issues, social commitment and
labour welfare practices of business houses. It is observed from Kamayogs CSR
rating (2009) that most of the Indian banks do not mention CSR on their annual
reports or on websites.
CSR rating of Indian financial Institutions
level(0-5)

No. of banks/fis

Name. of banks/fis

Level 0
Level 1

3
6

City Union Bank, Vysya Bank and Vijay Bank


Central Bank of India,Indusind Bank, Karnataka
Bank,Kotak Mahindra Bank,South Indian Bank & UCO

Level 2

15

Bank
Allahabad Bank,Andhra Bank, BOB,Bank of India,
Bank of Maharashtra Bank,IDBI bank,Bank of
Rajasthan,Corporation Bank,Federal Bank, HDFC
,Indian overseas,State Bank of Bikaner,State Bank of

Level 3

11

Mysore, State Bank of Travancore and Syndicate Bank.


Axis Bank,Canara Bank,Dena Bank,ICICI bank ,Indian
Bank,ING Vysya Bank, Jammu and Kashmir Bank,
Oriental Bank, Punjab National Bank,SBI and Union

Bank of India.
1
Yes bank
Nil
Nil
Source: Karmayogs CSR rating, 2009.

Level 4
Level 5

CHAPTER 4
PRESENT STATUS OF CSR IN BANKING
New companies bill is a step forward: Clause 135- corporate social
responsibility.
The new Companies Bill seeks to make it mandatory for companies of a certain
financial strength to spend at least 2% of their average net profit over three years
on corporate social responsibility. The Bill, which would replace the nearly sixdecade old Companies Act, 1956, was cleared by the Rajya Sabha on 8 August
while it had received the Lok Sabha nod in December last year. As per the new
norms, the two per cent spending on CSR is not mandatory but reporting about it
is mandatory. In case, a company is unable to spend the required amount, then it

has to give an explanation for the same. The CSR norms, that would come into
effect once the President gives his assent, would be applicable to companies
having either net worth of Rs 500 crores or more; turnover of Rs 1,000 crores or
more; or net profit of Rs 5 crores or more.
RBI revises bank KYC guidelines, advises new set of norms on July 1 2013
In a bid to strengthen its safeguards against money laundering, the Reserve Bank
of India (RBI) issued the master circular revising certain guidelines related to
bank Know Your Customer (KYC) policy. It suggested creating Unique
Customers Identification Code (UCIC) while bringing changes in new account
opening process .On July 16, 2013, RBI fines 22 banks Rs 50cr for violation of
know your customer which includes SBI, PNB and 20 more lending banks.

CHAPTER 5
CSR PRACTICES IN INDIAN BANKS
5.1 CSR PRACTICES IN BANKS
Banking in India originated in the last decades of the 18th century with the
establishment of General Bank of India in 1786 and the Bank of Hindustan
set up in 1870 (however both of the banks are now defunct). The oldest

bank existing in India is the State Bank of India and the apex regulatory
authority of Indian banking sector is Reserve Bank of India. At present, the
commercial banking structure in India consists of Scheduled Commercial
Banks & Unscheduled Banks. Since independence, banking in India has
evolved through four distinct phases:
Foundation phase (1950s till the nationalization of banks in 1969),
Expansion phase (mid-60s to 1984),
CSR Practices in Indian Banking Sector 857
Consolidation phase (1985 to 1991) and
Reforms phase (since 1992).
In recent years an attempt has been initiated to ensure socially responsible
behavior of banking sector in a more organized manner. The CSR in Indian
Banking Sector is aimed towards addressing the financial inclusion,
providing financial services to the unbanked or untapped areas of the
country, the socio-economic development of the country by focusing on the
activities like, poverty eradication, health and medical care, rural area
development, self employment training and financial literacy trainings,
infrastructure development, education, and environmental Protection etc.
RBI also insisted upon taking measures for sustainable development of
economy through realizing the dire necessity of CSR. Reserve Bank of India
(2007) stated that CSR entails the integration of social and environmental
concerns by companies in their business operations and also in interactions
with their stakeholders. The major thrust areas for CSR practice in Indian
banks are common in public sector and private sector banks. These areas
include children welfare, community welfare, education, environment,
healthcare, poverty eradication, rural development, vocational training,
women's empowerment, protection to girl child and employment.

5.2 SOME RECENT INITIATIVES BY INDIAN BANKS

In order to address ecological and environmental concerns, Reserve


Bank of India has decided to go for energy efficient buildings. Bureau of
Energy Efficiency has awarded the first star rating labels to the Banks
building at Bhubaneswar and New Delhi. The four buildings located at
Bhubaneswar, Chennai, Kochi, Kolkata are recognized as 5- star
building under the rating system.
Small Industries development bank of India
(the prime financer to small and medium scale industries) has also
incorporated environmental and social aspects in its core business
activities so as to ensure sustainable development. It is providing
concessional and liberal credit to medium and small scale industries
which are initiating energy saving projects and are adopting pollution
control measures.
State Bank of India (SBI),
the oldest bank has also adopted green banking initiatives in its lending
operations. Recognizing the warning of global warming bank has
decided to initiate urgent measures to combat the climate change
through envisaging two pronged approach viz. i) to reduce the Banks
own carbon footprint and ii) to sensitize the Banks clients to adopt low
carbon emission practices. ICICI bank has shown its commitment to
corporate environmental stewardship and extended a great support to
clean technology projects. It has also liberalized credit to zero emission
vehicles. IDBI has set up carbon desk. IDBI has come forward to join
hands with Smile Foundation in social development initiatives. The
bank has contributed 14 personal computers to Smile Foundation which
have been utilized in four different projects being implemented through
as many partners in Delhi and NCR. YES BANK, Indias fourth largest
private sector Bank, in association with CARE India, a humanitarian
relief and development NGO working in India for more than 60 years,
has launched Indias first Social Deposit Account (SDA). The Social

Deposit Account (SDA) is an evolution of the regular Fixed Deposit


account where customers have the option of donating their interest
income to a social cause through CARE India. It also won Best CSR
Practice Award in March 2011. Axis Bank Foundation (ABF) aspires to
contribute in the areas of education and healthcare. It has set up various
programmes which provide educational support, in order to meet these
goals. Balwadis- the Foundation has identified the need to focus on early
childhood programs for 2 - 6 year olds. As part of our initiatives to
support education, we help develop learning places for young children
living in large urban slum clusters so that it creates a strong foundation
and inculcates social and cultural awareness in them. HDFC Bank has
been working with NGOs for providing non formal vocational and
technical education 860 Deepika Dhingra & Rama Mittal programs as
well as skill up gradation courses to enable sustainable employment and
income generation for economically weaker sections.
5.3

INITIATING

CSR

PROGRAMS

IN

BANKS/

FINANCIAL

INSTITUTIONS:
Embracing CSR has to begin with decision at the highest corporate level
(board of directors), and adoption of action programs and performance targets
chosen in consultative processes involving the internal and external
stakeholders concerned. A first time CSR program of a bank or financial
institution would be likely to include action plans for:
i)

Ingraining environmentally and socially responsible practices within the

ii)

organization;
Engaging with borrowers in scrutiny of the environmental and social
impacts of their proposed undertakings (along the PKSF 2004 or
Equator Principles 2006 guidelines, as relevant);

iii) Reaching out with financial services to the less well off population
segments of the community (with own initiatives along lines indicated at
paragraph 1.2 above); and
iv) Community investments by way of donations to initiatives of Civil
Society Organizations (CSOs), NGOs and institutions involved in health,
education and culture; for social and environmental improvement
including nutrition, health and education in the disadvantaged
population segments (most banks and financial institutions in
Bangladesh already have significant outlays of such charitable expenditures,
these can fit in appropriately as elements in the new structured CSR
programs).

CHAPTER 6
THE FUTURE OF CORPORATE SOCIAL
RESPONSIBILITY

Companies today are increasingly sensitive about their social role. The
companies not only concentrate on how they will position their product or how
they will sell it but also they have a social strategy because they have started
feeling that brands are built not only around good quality of the product; but also
around emotions and values that people ascribe to those products

In addition to be more precisely defined, the CSR movement is evolving


following some trends that I intend to describe briefly:
First, there are no more a few companies, which have consecrated
themselves to this new doctrine, but the majority of large enterprises
have introduced it in their agenda. Philip Kotler and Nancy Lee in their
book Corporate Social Responsibility indicate that charitable giving
has risen from $9.6 b in 1999 to $12, 19 b. In spite of some opponents
like the survey in The Economist last year which maintains that CSR is
eroding the basis of the free enterprise system, every time more this new
doctrine is catching the attention of business people.
Second, since the term triple bottom line (people, planet and profit)
was carried in 1994, an accelerating progression from early concerns

about safety, health and environment to a growing range of social


concerns have been seen, among them human rights and diversity.
Recently other concerns like fair trade pricing and fair wages as well as
socially increasingly have increasingly made headlines. There is an
increasing conviction that there is not a conflict but a positive correlation
between CSR and profitability and that profit can go hand-in-hand with
social and environmental responsibility.
Third, the social responsible enterprises every time more publish their
activities for their shareholders and the public in general, either in their
general annual report or in CSR specific reports. According to a survey
of KPMG in 2002, 45% of co portions issued environmental, social or
sustainability reports compared with 35% in their 1999 survey. Greater
transparency is a means to improve accountability and trust.
Fourth, CSR has ceased to be a form of philanthropy so that it is no more
the case to sign a check at the end of each financial year, after a positive
result - and CSR enters into the normal activities of the corporation
before declaring its profits and becoming a all year around responsibility.
It is a shift to making long-term commitments to especial social issues
providing more than cash contributions, sourcing funds from business
units as well as philanthropic budgets, forming strategic alliances, etc.
CSR is becoming as much as anything a way of thinking about and doing
business. Corporate investment decisions driven by quarterly profit
earnings are short-sighted and sacrifice long-term wealth creation.
Fifth, it is no longer the owner or the CEO the one which decides to
write the check, but it is the collective commitment of all the corporation
from the CEO until the last employee; it is precisely the employees
satisfaction one of the objectives of CSR. There is an increasing
awareness of CSR among the workforce.
Sixth, before a social activity generally dissociated from the cooperation,
the trend is that the activity be totally related with the core business of

the cooperation, its products or services (for instance when an electronic


corporation decides to train the students of a school on the use of
computers).
Seventh, the establishment of a social norm to do good. As William Clay
Ford Ford Motor Company CEO there is a difference between a good
company and a great company. A good company offers excellent
products ands services. A great company also offers excellent products
and services but also thrives to make the world a better place. From the
philosophy of doing good to look good, to the conviction of doing
well and doing good.
Eighth, it is clear today that CSRs success requires the decisive
cooperation of the government and business in a strong symbiosis. This
is particularly clear in developing countries. As the World Summit on
Sustainable Development (Johannesburg 2000) recognized, partnership
between business, government and civil society is the key to the progress
we need on sustainable development.
Ninth, every time sectoral projects on CSR are materializing like in the
mining industry, the energy industry or the apparel industry, for example,
the Multi-fibre Arrangement Forum, or like the Equator Principles where
a group of large financial institution decided to impose conditions
particularly environmental conditions to their clients projects.
Ten. Up to now CSR has been something voluntary (voluntary to adopt
and voluntary to comply with). Today there is a big debate where CSR
should remain voluntary or should become compulsory. Many believe
for example that the limitation off the CO2 in the atmosphere emissions
will not stop voluntary unless it becomes a legal duty.

All of these trends mean that businesses need to manage their environmental
and social impacts much better: corporate responsibility has to cease being a
bolt-on to business operations; and instead be built-in to business purpose and

strategy. This involves a clear link to business values and culture; strong
leadership form the top; and the active engagement of stakeholders.
Potential benefits of implementing a CSR approach
Key potential benefits for firms implementing CSR include:

Better

anticipation and management of an ever-expanding spectrum of risk. Effectively


managing social, environmental, legal, economic and other risks in an
increasingly complex market environment, with greater oversight and
stakeholder scrutiny of corporate activities, can improve the security of supply
and overall market stability. Considering the interests of parties concerned about
a firm's impact is one way of anticipating and managing risk.
Improved reputation management. Organizations that perform well with
regard to CSR can build reputation, while those that perform poorly can damage
brand and company value when exposed. This is particularly important for
organizations with high-value retail brands, which are often the focus of media,
activist and consumer pressure. Reputation, or brand equity, is founded on
values such as trust, credibility, reliability, quality and consistency. Even for
companies that do not have direct retail exposure through brands, their
reputation as a supply chain partner -- both good and bad -- for addressing CSR
issues can make the difference between a business opportunity positively
realized and an uphill climb to respectability.
Enhanced ability to recruit, develop and retain staff. This can be the
direct result of pride in the company's products and practices, or of introducing
improved human resources practices, such as family-friendly policies. It can
also be the indirect result of programs and activities that improve employee
morale and loyalty. Employees become champions of a company for which they
are proud to work.

Improved competitiveness and market positioning. This can result from


organizational, process and product differentiation and innovation. Good CSR
practices can also lead to better access to new markets. For example, a firm may
become certified to environmental and social standards so it can become a
supplier to particular retailers.
Enhanced operational efficiencies and cost savings. These flow in
particular from improved efficiencies identified through a systematic approach
to management that includes continuous improvement. For example, assessing
the environmental and energy aspects of an operation can reveal opportunities
for turning waste streams into revenue streams (wood chips into particle board,
for example) and for system-wide reductions in energy use. Corporate social
responsibility (CSR) promotes a vision of business accountability to a wide
range of stakeholders, besides shareholders and investors. Key areas of concern
are environmental protection and the wellbeing of employees, the community
and civil society in general, both now and in the future. The concept of CSR is
underpinned by the idea that corporations can no longer act as isolated economic
entities operating in detachment from broader society. Traditional views about
competitiveness, survival and profitability are being swept away.
Some of the drivers pushing business towards CSR include:
1. The shrinking role of government
In the past, governments have relied on legislation and regulation to
deliver social and environmental objectives in the business sector.
Shrinking government resources, coupled with a distrust of regulations,
has led to the exploration of voluntary and non-regulatory initiatives
2.

instead.
Demands for greater disclosure

There is a growing demand for corporate disclosure from stakeholders,


including customers, suppliers, employees, communities, investors, and activist
organizations.
3. Increased customer interest
There is evidence that the ethical conduct of companies exerts a growing
influence on the purchasing decisions of customers. In a recent survey by
Environics Internationals, more than one in five consumers reported having
either rewarded or punished companies based on their perceived social
performance.
4. Growing investor pressure
Investors are changing the way they assess companies' performance, and
are making decisions based on criteria that include ethical concerns. The Social
Investment Forum reports that in the US in 1999, there was more than $2 trillion
worth of assets invested in portfolios that used screens linked to the environment
and social responsibility. A separate survey by Envirnics Internationals revealed
that more than a quarter of share-owning Americans took into account ethical
considerations when buying and selling stocks. (More on socially responsible
investment can be found in the 'Banking and investment' section of the site.)

5. Competitive labour markets


Employees are increasingly looking beyond pay checks and benefits, and
seeking out employers whose philosophies and operating practices match their
own principles. In order to hire and retain skilled employees, companies are
being forced to improve working conditions.

6. Supplier relations
As stakeholders are becoming increasingly interested in business affairs,
many companies are taking steps to ensure that their partners conduct
themselves in a socially responsible manner. Some are introducing codes of
conduct for their suppliers, to ensure that other companies' policies or practices
do not tarnish their reputation.
Some of the positive outcomes that can arise when businesses adopt a
policy of social responsibility include:

Company benefits:
Improved financial performance;
Lower operating costs;
Enhanced brand image and reputation;
Increased sales and customer loyalty;
Greater productivity and quality;
More ability to attract and retain employees;
Reduced regulatory oversight;
Access to capital;
Workforce diversity;
Product safety and decreased liability.

2. Benefits to the community and the general public:


Charitable contributions;
Employee volunteer programmes;

Corporate involvement in community education, employment and


homelessness programmes;
Product safety and quality.
3. Environmental benefits:
Greater material recyclability;
Better product durability and functionality;
Greater use of renewable resources;
Integration of environmental management tools into business plans,
including

life-cycle

assessment

and

costing,

environmental

management standards, and eco-labelling.


Nevertheless, many companies continue to overlook CSR in the supply
chain - for example by importing and retailing timber that has been illegally
harvested. While governments can impose embargos and penalties on offending
companies, the organizations themselves can make a commitment to
sustainability by being more discerning in their choice of suppliers.
The concept of corporate social responsibility is now firmly rooted on the
global business agenda. But in order to move from theory to concrete action,
many obstacles need to be overcome.
A key challenge facing business is the need for more reliable indicators of
progress in the field of CSR, along with the dissemination of CSR strategies.
Transparency and dialogue can help to make a business appear more
trustworthy, and push up the standards of other organizations at the same time.

The Global Reporting Initiatives is an international, multi-stakeholder


effort to create a common framework for voluntary reporting of the economic,
environmental, and social impact of organization-level activity. Its mission is to
improve the comparability and credibility of sustainability reporting worldwide.
There is increasing recognition of the importance of public-private
partnerships in CSR. Private enterprise is beginning to reach out to other
members of civil society such as non-governmental organizations, the United
Nations, and national and regional governments.
An example of such a partnership is the 'Global compact'. Launched in 1999 by
the United Nations, the Global Compact is a coalition of large businesses, trade
unions and environmental and human rights groups, brought together to share a
dialogue on corporate social responsibility.The 'Working with NGOs' section
offers some insights into the way businesses and lobby groups are working
together to mutual benefit. Management training plays an important role in
implementation of CSR strategies, and there is a growing number of conferences
and courses available on the subject. Organizations that provide such training
include Global Responsibility, Business for Social Responsibility and the
Corporate Social Responsibility Forum. The idea of Indian companies going
beyond business imperatives to do something for society has undergone
remarkable changes over the years. Time was when companies merely dispensed
cash by way of charity to organizations or NGOs engaged in social work. Others
promoted activities that were mutually beneficial, to villagers living around a
company plant or town as well as to their own employees.

For instance,

villagers were encouraged to produce more vegetables or keep cattle for milk,
with the company providing the start-up money, the knowledge and the
marketing infrastructure that ensured the extra produce got to town. The
villagers were encouraged to take the risk and try their hand at new farming
activities because of the assurance of a dependable market and a steady

income. That changed over time to community outreach: reaching out to the
communities around company plants or offices, and providing amenities that
were lacking. Companies supplemented facilities in schools or hospitals, helped
women earn extra income through sponsorship of, say, sewing machines or
community centers which, apart from generating income, promoted adult
literacy and family welfare activities. With the growth of environment
consciousness in the 1960s, companies felt the need to redeem themselves for
some of the damage done. They got involved in forestation, water conservation
and similar projects. The concept of corporate social responsibility (CSR) thus
evolved from philanthropy to a more elaborate concept that encompassed the
environment, employee relations, corporate governance and engaging with the
community. The current understanding of CSR also attempts to deploy a
companys core competencies to help address societys problems. Examples of
this approach abound, and one standout example is TCS, which has used its
expertise in information technology to help communities in different parts of
India help themselves. TCS has developed a database for Child Line, which
supports children in distress in 54 centres in India, all using volunteers from
among its employees; it has also designed and implemented a computer-based
functional literacy project, a unique idea that enables adults to learn to read
using low-end computers and a breakthrough software solution within 30 to
40 hours, over two-three months. Similarly, NIIT has used its IT expertise for
its hole in the wall experiment, where children from slums learn to use
computers with a touch screen. Cut from the same cloth is ITCs muchcelebrated e-choupals, which help farmers check prices in Indian and global
markets

before

going

to

the

marketplace

with

their

produce.

An important aspect of CSR today is the encouragement given to


employees to get involved in tackling social issues. Mother Teresa used to tell
admirers eager to offer her money: I dont want your money; I want your time.
She ended up getting both. CSR is no longer a fringe activity that companies

engage in to look good. Effective CSR today is that which relates directly to the
givers core competencies and offers real value, not just philanthropy. It is no
longer considered good for business, but simply good business. Because when
you give back to the society you operate in, you become truly embedded in that
society, rather than being perceived as seeking profits alone

CONCLUSION
At present the Banking Sector performing their banking services more
effectively in comparison with the past and also started working towards social
banking that is Corporate Social Responsibility. Maximum number of banks
whether related to private sector or public sector highly performing CSR
activities as per their priority but if we look towards the CSR reporting then we
can see that most of the banks are still not disclosing their amount for such
initiatives in their websites. After the involvement of RBI the CSR becomes the
important part of Banking Sector but still more regulations and new policies are
required to implement the concept of CSR in Indian Banking Sector .RBI should
made some criteria to distinguish between the banks conducting CSR practices
and those not conducting ,on the bases of their involvement in social banking
and some percentage must be set for spending on CSR activities by all the
established Banks and a proper monitoring is required by a committee on the
working of Banks so that the Banks work for their profit along with contributing
towards the society because Corporate social responsibility is just not the charity
but a practical implementation of ethical ideas towards the society. Banking
sector in India is showing interest in integrating sustainability into their business

models but its CSR reporting practices are far from satisfaction. There are only a
few banks which report their activities on triple bottom line principles. As a
matter of fact, the standards for rating CSR practices are less uniform in
comparison to that for financial rating. This leads to problem in comparison of
corporate houses and determining the CSR rating. The study found out that
among the reporting banks also, some banks are making false gestures in respect
of their efforts for socioenvironmental concerns. Most of the Banks use CSR
practices as a marketing tool and many are only making token efforts towards
CSR in tangential ways such as donations to charitable trusts, NGOs,
sponsorship of events, etc. Very few banks have a clearly defined CSR
philosophy. Mostly banks implement CSR in an ad-hoc manner, unconnected
with their business process and dont state how much they spend on CSR
activities. Further voluntary actions are required to be taken by the financial
bodies to ensure the socio-environmental feasibility of projects to be financed.
Indian banking sector must also portray their socially responsible behavior.

BIBLIOGRAPHY

Books
S. K. Chaudhury, S. K. Das and P. K. Sahoo, Practices of corporate social
responsibility (CSR) in banking sector in India

Website
Karmayog Report.(2009).
Retrived from http://www.karmayog.org/csr2009

www.smeworld.org/story/special-reports/corporate-social-rep-csr-activityhistory-india.php

http://www.moneycontrol.com/news/business/rbi-revises-

bank-kyc-guidelines-advises-new-setnorms_908856.html