Under The Guidance of DR - Jitendra Kaher

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A PROJECT REPORT ON
ETHICAL HUMAN RESOURCE MANAGMENT IN
BANKING SECTOR
A PROJECT SUBMITTED TO
UNIVERSITY OF MUMBAI FOR PARTIAL COMPLITION
OF THE DEGREE IN BACHELOR IN MANAGMENT
STUDIES
BACHELOR OF MANAGEMENT STUDIES

(HUMAN RESOURCES)
Under the Faculty of BMS
By
BHAGWATI NEUPANE
ROLL NO 132
UNDER THE GUIDANCE OF
DR.JITENDRA KAHER
MKLM’s B.L AMLANI COLLEGE OF COMMERCE AND
ECONOMICS, VILE PARLE(W), MUMBAI-400049
Downloaded by Abirami Thevar (abiramithevar26@gmail.com)

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Declaration by learner
I the undersigned Ms. BHAGWATI NEUPANE here by, declare that the
work embodied in this project work titled “A STUDY OF ETHICAL
HUMAN RESOURCE MANAGEMENT IN BANKING SECTOR””
forms my own contribution to the research work carried out under the
guidance of
“Dr. JITENDRA K. AHERKAR” is a result of my own research work and
has not been previously submitted to any other University for any other
Degree/Diploma.
Wherever reference has been made to previous works of others, it has been
clearly indicated as such and included in the bibliography.
I, hereby further declare that all information of this document has been
obtained and presented in accordance with academic rules and ethical
conduct.
Bhagwati Nepuane
Certified by
Dr. Jitendra K . Aherkar

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Declaration by learner
I the undersigned Ms. BHAGWATI NEUPANE here by, declare that the
work embodied in this project work titled “A STUDY OF ETHICAL
HUMAN RESOURCE MANAGEMENT IN BANKING SECTOR””
forms my own contribution to the research work carried out under the
guidance of
“Dr. JITENDRA K. AHERKAR” is a result of my own research work and
has not been previously submitted to any other University for any other
Degree/Diploma.
Wherever reference has been made to previous works of others, it has been
clearly indicated as such and included in the bibliography.
I, hereby further declare that all information of this document has been
obtained and presented in accordance with academic rules and ethical
conduct.
Bhagwati Nepuane
Certified by
Dr. Jitendra K . Aherkar

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Acknowledgement-
To list who all have helped me is difficult because they are so numerous
and the depth is so enormous.
I would like to acknowledge the following as being idealistic channels and

fresh dimensions in the completion of this project.
I take this opportunity to thank the University of Mumbai for giving me the
chance to do this project.
I would like to thank my Principal Dr. Jitendra K. Aherkar for providing

the necessary facilities required for the completion of this project.
I take this opportunity to thank our Coordinator Prof.Suryaprakash Singh

for his moral support and guidance.
I would also like to express my sincere gratitude towards my project guide

Dr. Jitendra K.Aherkar and College Library whose guidance and care
made the project successful.
Lastly, I would like to thank each person who directly or indirectly helped
me in the completion of the project, especially my parents and peers who
supported me throughout my project.

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CHAPTER 1 – INTRODUCTION
 Human resource management (HRM or HR) :-

The strategic approach to the effective and efficient management of people in a
company or organization such that they help their business gain a competitive
advantage. It is designed to maximize employee performance in service of an employer's
strategic objectives. Human resource management is primarily concerned with the
management of people within organizations, focusing on policies and systems. R
departments are responsible for overseeing employee-benefits design, employee
recruitment, training and development, performance appraisal, and reward management,
such as managing pay and employee-benefits systems. HR also concerns itself with
organizational change and industrial relations, or the balancing of organizational
practices with requirements arising from collective bargaining and governmental laws.
The overall purpose of human resources (HR) is to ensure that the organization is able to
achieve success through people. HR professionals manage the human capital of an
organization and focus on implementing policies and processes. They can specialize in
finding, recruiting, selecting, training, and developing employees, as well as maintaining
employee relations or benefits. Training and development professionals ensure that
employees are trained and have continuous development. This is done through training
programs, performance evaluations, and reward programs. Employee relations deals
with the concerns of employees when policies are broken, such as cases involving
harassment or discrimination. Managing employee benefits includes developing
compensation structures, parental leave programs, discounts, and other benefits for
employees. On the other side of the field are HR generalists or business partners. These
HR professionals could work in all areas or be labour relations representatives working
with unionized employees.
HR is a product of the human relations movement of the early 20th Century, when
researchers began documenting ways of creating business value through the strategic
management of the workforce. It was initially dominated by transactional work, such
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as payroll and benefits administration, but due to globalization, company consolidation,

technological advances, and further research, HR as of 2015 focuses on strategic
initiatives like mergers and acquisitions, talent management, succession planning,
industrial and labor relations, and diversity and inclusion. In the current global work
environment, most companies focus on lowering employee turnover and on retaining the
talent and knowledge held by their workforce. New hiring not only entails a high cost
but also increases the risk of a new employee not being able to adequately replace the
position of the previous employee. HR departments strive to offer benefits that will
appeal to workers, thus reducing the risk of losing employee commitment and
psychological ownership.
Fast global and technological developments have made today’s business environment
highly uncertain and even chaotic. Organizations are seeking newer ways to promote
their adaptability to the complexities of the changed scenario so as to survive and
prosper. Globally, organizations are striving to realize competitive success through
strategic management of human resources. Thus, people management has never been
more important than it is today. Therefore new themes have emerged in the process,
replacing some of the old ones. The new thinking in this regard is referred to as Human
Resource Management (HRM), which carries a more proactive and strategic
connotation. HRM is intimately intertwined with business strategy. In many situations,
it even critically influences business strategy.
The development of employee commitment through employee involvement and

empowerment is one of the key objectives of any HRM discourse. The complex
business objectives in today’s business environment are difficult to realize without
developing highly committed and motivated employees who would strive to contribute
to organizational goals. That is why, human resource issues are no more the exclusive
preserve of personnel specialists; rather line and general managers are being
increasingly involved in handling key HR issues and in evolving, shaping and managing
human resource strategies and policies. These developments have given a far greater
recognition to the HR function in organizational decision-making processes.

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• Banking has been and will always be a ‘People Business’. Though pricing is
important, there may be other valid reasons why people select and stay with
particular bank. Banks must try to distinguish themselves by creating their own
niches or images, especially in transparent situations with a high level of
competitiveness. In coming times, the very survival of the banks would depend on
customer satisfaction. Those who do not meet the customer expectations will find
survival difficult.
• Banks must articulate and emphasise the core values to attract and retain certain
customer segments. Values such as sound, reliable, innovative, international, close,
socially responsible, Indian, etc. need to be emphasised through concrete actions on
the ground and it would be the bank’s human resource that would deliver this. It is a
common complaint among bank executives that skilled manpower is in short supply.
No two arguments on this, Human resources are becoming scarce – both in quality
and quantity.
• It is quite elementary that any resource that is in short supply needs to be properly
managed for the benefit of society and, therefore, you need to pay attention to the
entire human resource management process. What do I mean when I say this? You
need to manage the people – and for this you need to discriminate between the
people, I mean positive discrimination.
• The entire spectrum of ethical HR practice requires revolutionary changes if the

banks have to survive. Managing the people is the key challenge. And, in my
opinion, discrimination is the key word when dealing with people. You will notice
that I will use this word very frequently during my discussion.
• Ethical HR management is must necessary as banks are the important part of human
life, as they should be clear and adequate with the management of the services they
are providing to their customers so that t is properly and satisfactorily delivered to
the customers.

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A STUDY OF ETHICAL HUMAN RESOURCE MANAGEMENT IN BANKING SECTOR

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• The ever changing banking industry, with a steady growth in the past decade, has
resulted in many vacancies and overall growth in the sector. The number of branches
of Public sector has risen significantly and accordingly the requirement for
skilled manpower has grown as well. The HR management team is responsible in
any banks to analyse future requirements of their organization and steadily calibrate
recruitment process.
• The changing scenario of the banking sector with emergence of online banking and
core banking services, there is a need to incorporate youth energy and exuberance in
work. But, there should be a fine balance between the youth energy and experienced
professional, to make it a successful and fruitful combination, just like in any other
sector. Hence, the HR management is responsible for maintaining this balance and
undergo some cultural and management adjustments to fit in the people working.
• The technology along with the method of working in banking sector is changing
rapidly. Not only the machines, but approaches to various schemes, policies and
banking facilities are changing with time. The new recruit and the older ones as well,
need to undergo necessary training to grasp the same from time to time. The human
resource management makes sure that the people working in the banking
organization are not suffering from any such discrepancy. Empowering the
employees with training and measuring their performance afterwards, is what the
human resource department needs to look after.
• Performance management and talent spotting: The HR management remains

responsible for measuring the overall performances of the employees working in
different departments. They focus more on the people who are lacking the spirit of
working in the organization and try to help them improve their performance for the
betterment of the bank. To give importance to the hard-work and dedication of
employees, the HR department provides the adequate praise and promotion to them.
• The banking sector is a wide financial and economical industry, which depends
majorly on the workforce. Thus managing and maintaining this workforce becomes
the priority for the HR department in the banks. It is also important for the HR

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management team to have a look at the present and possible future

requirements of the banks and work accordingly with the same.
 Achieve organizational goals

HRM function starts here. One major HRM objective is to fulfil organizational
goals. Utilizing human resources to achieve business requirements and goals is
very important for an effective HRM.
 Work culture
When it comes to handling HRM effectively and following objectives, employee
and work environment are the prior factors. Work culture plays an important role
in defining HRM and business performance.
An HR manager needs to be active while calling for strategies to foster better work
culture. Automated activities like leave approvals, reimbursement request
acknowledgement, etc. can help you. Quick operations and empowerment to
employees help in creating positive vibes at the workplace. Developing and
maintaining healthy and transparent relations among team members and teams
contribute to building a good example of work culture. Adopting the right
solutions like employee management software can solve more than half of your
job.Small steps like short and sound onboarding processes can help build a good
image of the workplace.
 Team integration
One of the prime roles and objectives of HRM is to make sure the team
coordinates efficiently. Easy communication is the need for teams at an enterprise.
An HR here must ensure a tool to assist in making the integration easier and
smooth.
The proper connection between individuals is a must to ensure productivity. To

make HR management successful, you need to search for better integration portals
to make data availability easier for people. Functional objectives like team
integration are to produce streamlined operations and tasks. A right tool like the
self-service portal can bring employees closer to HR folks.

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 Training and Development

Workforce being effective and performing are two important and basic elements to work
upon for achieving your basic objectives at an organization. With proper training and
providing future opportunities, employees feel safe and organized.
Effective employment is highly dependent upon the training practices. Providing

opportunities to employees is one great step to ensure workforce management.
There might be difficulties such as planning, scheduling, training sessions, and

evaluation of each on-boards. To lessen the pain, solutions like training management
software can help you with auto-reminders, easy scheduler, reporting, and tracking
capability. The HR manager can ensure effective training practice at the firm.
 Employee motivation
The prime objective of HR folk is to keep things on the right path. Keep distractions and
negative vibes away. For this, the employees need to be attended to and kept motivated
throughout. How can HR motivate employees?
Give powers to them. Take their views on things. Involve them in weekly meets or
decisions. Even if it is a fresher, let them join. Keep the morale always high. Employee
recognition like yearly appraisal based on their performance can too help.
An automated feedback system for performance appraisal management can keep your
employees motivated and ensure productivity throughout the service. When the
employees are satisfied and fulfilled, nothing else can prevent you from losing your
objectives and goals.
 Workforce empowerment
Talking about employee motivation, nothing can work better than empowering them.
Empowering them with tools like ESS (employee self-service) portal can help save HR
efforts too.
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With the portal, employees can themselves apply for approvals and track them through
their mobile phones. Be it leave request, generating payslip, checking PF account,
remaining leaves, upcoming holidays, manager details, or anything, HR intervention is
least required. Now, you no more need to knock on HR’s desk for small queries.
What else could empowering workforce take? How would you ensure the right
workforce engagement? Effective HRM measures can definitely help. Look for easy
employee management tips.
 Retention
Providing leadership qualities and opportunities, a healthy working area, and employee
retention are some prime objectives and deliverables of the HR managers. Keeping
employees retained and motivated needs to be a top priority for HRM.
Other than employee hiring, onboarding, and training cycle, keeping the employees
retained for long is the biggest challenge AKA objective of the HR people. It often
occurs that employees leave the organization within 2 months of onboarding. It can be
due to ineffective training management or a rough hiring process.
Employee experience needs to be carefully attended. Keeping your employees retained

can help maintain a good state of employee turnover. To keep it stable, the HR manager
needs to learn the best retention tips for business.
 Data and compliance

Functional and organizational objectives also include managing company/ employee
data and managing compliances. Managing payroll compliances and keeping the
company out of any penalties or fines is a huge challenge for HR people and managers.
Even a small error or miscalculation can owe you huge penalties and even may lose
respect. When committing to tasks like employment and payroll, you need to be careful
about laws and regulations. The objective here is to keep any unwanted claims at bay for
smooth functioning.
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1.1 Objectives of the study
Every task has a particular aim. A study without objective cannot reach its destination. The main
objectives of this study are to find out the overall HRM process of various banks. The objectives of the
study conducted in the banks are mentioned as under:
• To study the ethical human resource management in the banks.

• To study the problem faced by the employee in banking sector/industry.  To
identify ethical human resource management strategies
1.2 Methodology use to collect data
• Methodology used in the introduction part is the collection of raw data and primary
data.
• Primary data collected through the employee of a bank
• Convenient sampling method is used select respondents
• For analysis interpretation suitable statically technique are used like graph, tables etc.

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 HRM in Employee Welfare:

This particular aspect of HRM deals with working conditions and amenities at workplace.
This includes a wide array of responsibilities and services such services as safety services,
health services, welfare funds, social security and medical . It also covers appointment of
safety officers, making the environment worth working, eliminating workplace hazards,
support by top management, job safety, safeguarding machinery, cleanliness, proper
ventilation and lighting, sanitation, medical care, sickness benefits, employment injury
benefits, personal injury benefits, maternity benefits, unemployment benefits and family
benefits.
It also relates to supervision, employee counselling, establishing harmonious relationships

with employees, education and training. Employee welfare is about determining
employees’ real needs and fulfilling them with active participation of both management
and employees. In addition to this, it also takes care of canteen facilities, crèches, rest and
lunch rooms, housing, transport, medical assistance, education, health and safety,
recreation facilities, etc.
 HRM in Industrial Relations:
Since it is a highly sensitive area, it needs careful interactions with labour or employee
unions, addressing their grievances and settling the disputes effectively in order to
maintain peace and harmony in the organization. It is the art and science of understanding
the employment (union-management) relations, joint consultation, disciplinary procedures,
solving problems with mutual efforts, understanding human behaviour and maintaining
work relations, collective bargaining and settlement of disputes.
The main aim is to safeguarding the interest of employees by securing the highest level of
understanding to the extent that does not leave a negative impact on organization. It is
about establishing, growing and promoting industrial democracy to safeguard the interests
of both employees and management.
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CHAPTER 2
REVIEW OF LITERATURE
1. Dr. K.A. Goyal and Vijay Joshi

Economic performance of a country is largely determined by banking and
financial system. Banking and finance play a vital and crucial role in framing public
policies in today’s business environment. This article highlights social and ethical issues
such as social banking, ethical banking, green banking, global banking, rural banking,
and Agribanking, which help in achieving sustainable development of banking and
finance. For this purpose, we have gone through a series of development that are taking
place in current business scenario. This paper is divided in four parts. First part discuss
introduction of Banking Industry in India. Second part explains historical background of
banking and its development. It also discusses concept of Banks. Third part analyses the
review of past studies on the theme. Fourth part highlights Social and Ethical issues
related to Banking Industry and finally conclusion has been given.
2. Journal of Business Ethics
This paper explores the behaviour of the banking industry in the new business
environment that arose after the subprime crisis. The main hypothesis is that there are two major types
of banking institutions: conventional banks and ethical banks. Each has a distinct business model. To
test how they have reacted to the new environment, factor analysis techniques have been used. The
main findings are twofold. Firstly, the new financial context has indeed caused the behaviour of
mainstream banks to change. Within this group, one can further distinguish between those that have
tried to anticipate the changes by adopting a more responsible financial attitude and those that have
merely modified their banking practice to comply with the new regulatory framework. Secondly, there
are the so-called ethical banks. Interestingly, their behaviour has scarcely been altered by the new
financial context. The main conclusion is that the different response of both types of banks reflects the
existence of a distinct business model.
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3. Sunny Gupta
In this competitive world each bank needs to own most market share. during
this last most share differing kinds of selling methods and ways area unit adopted by
banks. except for the expansion and survival each business should trade off between
'profit' and 'ethical' problems regarding their promoting methods. So, a number of these
promoting methods adopted by banks may be unethical. Unethical practices will profit
briefly run however will severely injury name of bank within the end of the day. In
general, ethics is outlined as “a branch of philosophy coping with what's smart and
dangerous and with ethical duty and obligation”. Ethics is that the common prescribed
follow of various ethical principles or values. It concentrates on the overall nature of
ethical and therefore the specific moral alternative a private makes in relationship to
others. Ethics in banks is all the a lot of vital because it establishes confidence of public
within the system. smart moral practices area unit vital for banks as banking industry is
predicated on trust and confidence of individuals. gift paper is modest decide to uncover
unethical practices in promoting of banks and problems that make moral conflict. "Core
moral values embrace honesty, integrity, fairness, accountable citizenship and
responsibility. In short, business ethics means that "choosing the great over the
dangerous, the proper over the incorrect, the truthful over the unfair, the reality over the
lie". perceptive the law is one basic skilled demand for banks. they have to additionally
pay shut attention to ethical issues so as to create the proper moral selections on a daily
basis. The upholding of associate moral culture in banking is of crucial interest to
regulators, banks, workers and customers alike.
Banking ethics area unit the ethical or moral principles that bound banks selected to
abide by. There isn’t associate ethics investigator or a universal code of moral conduct,
however the banks that vaunt their moral credentials vet the moral standing of potential
investors and partners and additionally select the businesses that they successively
invest in with their ethical policy in mind.
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4. Sustainability and Ethical Banking: A Case Study of Punjab

National Bank, (Amrish Dogra & Manu Dogra)
In the field of banking and finance, Ethical banking is a business model that responds to
emerging approaches to sustainable economy based on the principles of corporate social
responsibility. Ethical banking is also known as ‘sustainable banking’ or ‘civic banking’
or ‘clean banking’. ‘Transparency in reporting’ is a major value integrated in the
fundamentals of ethical banking (Barcelona, 2012). The recent disclosure of mega scam
in Punjab National Bank has violated this fundamental norm of ethical banking. Besides,
the surmounting nonperforming assets in banks pose a threat to the sustainability of
these banks. The present study focusses upon these two areas of CSR by forecasting
NPAs of PNB in 2025 and by highlighting the present case of mega scam in the bank.
The study has forecasted the non-performing assets of PNB on the basis of quarterly
data from 2010 to 2017. Basel II guidelines regarding better supervisory review, market
discipline via certain disclosure requirements and minimum regulatory capital were
introduced in an advanced manner in India in 2010. Hence, quarterly data relating to
repo rate, gross domestic product, inflation rate and loans and advances from 2010 to
2017 has been considered. The second major objective of the study aims at highlighting
the recently revealed scam relating to Punjab National Bank. Coincidentally, the PNB
scam also lasted seven years from 2010 to 2017. For forecasting non-performing assets
of PNB in 2025, E-views 8 have been used to perform multiple linear regression on the
data. Besides, the case also gives an outline of the scam declared on February 14, 2018
which highlights the fraudulent transactions at one of its branches. (Hindustan Times,
Feb 20, 2018). The study empirically finds out that if the trend goes on, the Gross NPAs
of Punjab National bank will be equal to INR 84140.46 crores which is 9.56% of its
average loans and advances. The results are quite alarming. The study has forecasted the
non-performing assets of PNB using multiple linear regression equation. The forecasted
NPA figure can help the regulatory bodies in further analysis of bank’s financial
soundness post scam. The intent of this critique study is to incite further exploration of
the financials of PNB giving due consideration to nonreported transactions covered
under the scam.
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CHAPTER 3 : CONCEPTUAL FRAMEWORK
3.1 Principles of ethical HR
 Professional Responsibility:
As a professional, the HR manager is responsible for adding value to organisation
he is serving and he must contribute to the ethical success of the organisation. He should
accept responsibility for his personal decisions and actions. He is also an advocate for
the profession by engaging in activities that enhance its value and credibility.
 Professional Development:
As professionals, the HR managers must strive to meet the highest standards of
competence and commit to strengthen their own competencies on a continuous basis.
 Ethical Leadership:
HR professionals are expected to exhibit individual leadership as a role model for
maintaining the highest standards of ethical conduct.
 Fairness and Justice:

The HR managers are responsible for promoting and fostering fairness and justice
for all employees and their organisation. The purpose of this principle is to create an
environment that encourages all individuals and the organisation to reach the fullest
potential in a positive and productive manner.
 Conflicts of Interest:
HR managers must maintain a high level of trust with all their stake holders.
They must protect the interests of their stakeholders as well as their own professional
integrity and should not engage in activities that create actual, apparent or potential
conflicts of interests.
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 WHAT IS BANKING SECTOR IN GENERAL ?

The main idea of this chapter is to provide information of bank with some
examples. Moreover, this chapter helps the reader to identify the HR metrics as well as
internal and external factors affecting inside the bank.
3.2 The definition of bank

Banks plays an important role in the development of economy. Bank is the
financial institution which is permitted to receive deposits, conduct monetary policy,
and make loans. Banks may also provide financial services such as wealth management,
currency exchange and safe deposit boxes (Investopedia 2018). Banks creates liquidity
for the public on the balance sheet by transforming relatively illiquid assets for example:
loan commitments and similar claims to liquid funds (Berger, Molyneux & Wilson
2015). Other tasks of banks are to reduce interest rate, credit, foreign exchange rate and
liquidity risk. Some of the largest banks has transformed themselves into multiproduct
multimarket, financial service conglomerates which offer retail banking, investment
banking, breakage, insurance, wealth management services (Berger, Molyneux &
Wilson 2015).
In addition, there are various other things that helps to run banks for e.g.: staffing,
human resource, security, facility management, technologies, and logistics etc. Banks
are divided into different types, but the most common banks are commercial banks,
investment banks and Central banks. In most countries, the national government or
central bank regulates banks (Investopedia 2018). Central banks are the head of other
banks that functions as the chief and is responsible for the economic stability,
controlling the inflation and the monetary policy and commanding the money supply.
The example of central bank is Bank of Finland, Nepal Rastra Bank, Bank of Israel.
According to the sources, Euro countries have their own euro system The European
system of central Banks (ESCB) and national central banks (NCBs) consisting of 28 EU
member states. Commercial banks provide savings, withdrawals and provides short term
loans to individuals and small business entities. Commercial banks are mostly selected
because of its services that it provides such as saving accounts, mortgages etc. Some of
the examples of commercial banks 20 of Finland are Aktia Savings Bank, Nordea Bank,
OP corporate Bank, Danske Bank etc. Investment banks are the banks that is concerned
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to provide corporate clients with assisting and underwriting with merger and acquisition
activity. Some of the examples from U.S. investment banks are: Invest Morgan Stanley
and Goldman sachs Group Inc (Investopedia 2018). Therefore, banks are the most
important part of economy that handles all the monetary system.
Types of Bank
There are some banks that work in multiple areas which might offer many kinds
of services such as business accounts, personal accounts as well as helps larger financial
markets in raising money. Different types of banks are central banks commercial banks
etc.
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• Central bank is a bank that is authorized to provide guidance and regulate the
banking system of a particular country. Central bank is responsible for
managing banking activity of all the banks inside the country. The task of
central bank is to maintain deposit accounts of other banks and provide loans as
well as guidance to the banks which are in need. It maintains record of
government revenue and expenditure. It also advises the government on
monetary and credit policies. Central bank decides the interest rates for bank
deposits including foreign exchange rates.
• Commercial banks are the banks that are mostly subjected to focus on the
business customers. for example; business related saving accounts. Businesses
need more complex services than the individuals. They provide various services
related to the dollar, euro amounts that has high number of transactions and is
much larger. Commercial banks accept payments from customers and manage
cash flow and use letters of credit to do business overseas (Pritchard 2018).
However, nowadays most commercial banks offer their services to consumers as
well. Therefore, it provides savings accounts, safe despite boxes, loads, credit
cards etc. to people as well.
• Retail banks are defined as the banks that is concerned with providing services
to the public people as their customers. These types of banks help in savings
accounts and providing credit cards, offering loans. They also have numerous
branch in many cities within the country. Retailed banks are similar to the
saving banks (Pritchard 2018)
• Investment banks helps in financial markets and business works. In case

whenever the business needs or wants to sell their debt to investors they usually
prefer investment banks (Pritchard 2018). Investment banks do not accept
deposits but assists companies which are involved in acquisitions.
• Credit unions are not exactly banks, but it is known as similar to banks, they are
also known similar to the Mutual banks. These types of banks are not for profit
organizations but owned 22 mostly by the investors. Credit unions offers less
identical or mostly products or services to the retail and commercial banks
(Pritchard 2018).
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 Online banks are exclusively online. They don’t have any physical locations or
branch where people can visit. For example: pay bills online, internet only
banks etc. (Pritchard 2018). Services are done through the internet.
3.5 Human Resources Metrics and Benchmarking of Bank

The strategic goals of the human resource management are to develop the policies
and practices that helps to produce the employee’s proficiency and behaviours in HR
(Dessler 2015, 105- 106). Metrics is the standard measurement of the organization’s
behaviour, activities and performance. HR metrics is the important way to evaluate the
quality and impact of the employee in an organization. Tracking Applicant metrics is
basically used in recruiting employees and measuring them. One of the good examples
of the Metrics measurement is the Authoria’s system. Metrics helps in reducing the
recruiting costs (Dessler 2015, 105-106).
The word ‘benchmarking’ is known as evaluating or comparing with the standard.
As a process, it can be compared into two process quantitative and qualitative. Thus,
comparison can be made between two separate organizations or between different
divisions within the organisation. Therefore, it is common for employer to compare the
HR metrics with another companies so that the company knows their performance and
competition in the business world (Roth 2012).
Bank is formed with two different factors that is internal and external pressures.
Both the pressures are equally important for the bank. With the challenging economy
the change in these both factors are noticeable. In another word, the change can be
related to the pressure of the internal and external factors (Roth 2012, 1-2).
Therefore, the operational excellence, improvement in workforce capability,

improving the future managers & directors and the growth of emerging markets
challenges the pressure on the growth of emerging markets (Roth 2012, 1). Internal and
external factors of bank (Adapted from Deloitte 2012)
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HR executives in banking organizations are considered in accomplishing cost

competitiveness in fluctuating financial market (Roth 2012). HRM focuses on delivering
equal services to both factors. HR must provide the instant support to the change in
organizations with the unexpected change in market conditions. From CEO to the
employees working in front line, dealing with the customers’ needs to be provided with
the excellent service similar to the customers’ expectations. The following things must be
taken into consideration such as developing product and channel with strategies,
managing global workforce, developing the strategic expansion, promoting operational
performance and developing the performance by new talent management approach.
The present situation of the banking and under HR assistance is very unpredictable
and underperforming because of the challenging world’s economy (Roth 2012, 2). With
changing HR policies and the change in organizations both the internal and external
pressures of banking organizations must compare high-performing companies to their
own to find out what makes them improved. HR metrics and benchmarking seems
preceding to the decisions making and illustrate the productivity of their employee in HR
through various options such as customer feedbacks, Surveys and change the HR policies
according to the changing market.
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3.6 Human Resource Management and Organisational Performance

The nature of the HRM performance link is traced by examining direct and
indirect relationship between individual HR practices (Darwish 2013, 13-18). The
studies however show that the specific HR practices can lead to the competitive
advantage and as a result can upgrade the organisational performance. In other words, a
set of HR practices can improve the performance of an organisation inadvertent and
environment while it is believed that HR practices will lead an organisation to the better
performance in any situation (Darwish 2013,13-18). HR practices refers to the training
courses and motivational programs which assist management in performing better tasks.
An author Darwish (2013), has discussed that whoever adopted the approach ‘bundle of
practices’ should generate greater effects than the individual HR practices because it is
discussed that the whole is greater than the sum of its small parts or in another word it is
argued that the individual HR practices are finite to get competitive advantages for an
organisations (Darwish 2013, 13-18). Therefore, many researchers only agreed that
practices will lead to better performance for all types of firms, in terms of measurement
of HR practices (Darwish 2013, 13-18).
According to the research there has been both agreement and criticism is terms of
HRM and the performance. In the second research stream, indirect relationship between
HRM and performance, researches has criticised by arguing that both individual
practices and bundle of practices do not directly affect the organisation’s performance
(Darwish
2013 13-18). There are two factors they are internal and external factors on HRM
performance relationship. Internal factors include employee satisfaction, research and
development, leadership, employee commitment, employee turnover and social climate
(Darwish 2013, 13-18). External factors can have considerable impacts on the
company’s performance.
In order to upgrade HRM performance for the organisational performance there is

none other than practicing HR activities for the long time with the better outcomes
resulting into the high competitive advantage. HRM activities must be followed to make
the work more efficient and effective. The first most important activity or HRM includes
staff recruitment, HR planning, 25 benefits to the employees, participation in different
training and motivational programs, decentralisation, opportunity for internal promotion,
autonomy, coaching and HR bundles for internal factors (Darwish 2013,19-18). HRM
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performance is performed for the competitive advantage of an organisation such as

profit in an organisation, customer satisfaction, increase in sales, market value, market
share, development of product and service, productivity and future investment.
External factors have two separate variables where is specific to an organisation

following the demand condition, its competitive environment and market structure
whereas the second one compose natural, economic, social, technical and political
factors etc. these does not vary from one organisation to another and they are visible to
outsiders (Darwish 2013, 17).
Moreover, there are certain things that work as a control variable for example,
Level of an organisation (size, age, technology, capital intensity etc. whereas the next
thing is an Individual’s level for example, employee’s age, gender, education lever,
nationality and job experiences). These are the variables that plays vital role in
performing the HRM activities for the best result (Darwish 2013, 16). We can take good
example of a commercial bank for example, OP has many small branches in various
cities in Finland. The HRM activities is interrelated with the HR performance because
of the qualified staffs with different age groups working in many parts of the country.
The information flow, HR planning and training leads employees to stay updated and
work efficiently. As a result, positive outcome leading to customer satisfaction.
Employee satisfaction builds trust and gives productivity of the bank.
3.7 Challenges of HRM

Globalization has made drastic change in the business world. Along with
company’s economy to the HRM, we could notice many changes and challenges.
Competition has grown up in accordance with technologies. Banking institutions and
many other organizations has faced both good and bad changes.
In comparison to both, international and national banks globalization.

Development in technologies, challenges and opportunities, are the common challenges.
HRM challenges are categorized into 3 categories.
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In the above figure three categorized HR challenges are multi-dimensional issues.

Environmental challenges are the external forces that can affect the performance of the
organization. Some of the environmental challenges are mentioned above in the figure.
Work force diversity falls under the environmental challenges. Along with the
globalization, Organizations are expanding, many people having different cultural
backgrounds, religions, ethnicity, gender, social status, age group etc. are working
together. The importance of diversity in an organization is to bring together the talents
and creative people inside an organization. In many Asian countries, high gender
inequality has been faced. Women employees are not treated same as the Men employees.
According to the given source Asian Development Bank (2011) women are earning 70
percent– 90 percent less of the male wage. However, cultural differenc create more
challenges because of the thinking of the person towards working life, treating women,
co-workers and adapting changes. In working life people have been facing many gender
inequalities, racism, discrimination in terms of positions and many more issues in the
work place.
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The development of technology has been started from the beginning of 21st
century.
The field of Telecommunication and Computer are emerging significantly (Zkjadoon
2015). Therefore, with the changing technology the person with good technological
skills are always in high demand. However, while recruiting staffs HR faces difficulties
to find the right skilled person. Additionally, old employees must be trained to keep
updated with all the new technologies. Not having technological skills could be
challenges to employers. Additionally, globalization and increase in competition in
foreign and domestic businesses are getting global and highly productive. Therefore, the
challenge is quite tough for the HRD to update employees with the new technology
skills (Zkjadoon 2015).
Organizational challenges are the internal factors that can be controlled by
management inside the organization. HRM can be challenging for both small and big
businesses. However, it can be more challenging to those small businesses that doesn’t
have HRD to commit for. While in big organizations HR managers duty is to manage
workforce and be prepared for the future challenges. HR managers are aware about the
challenges beforehand for which they have already prepared themselves. There are lots
of organizational challenges that might affect workforce of an organization in long run
(Zkjadoon 2015). Some of them are: unstable employment laws, rules and regulations,
change in management, training and development, complying new technologies, cost
controlling, improving quality, retention and recruitment of employees (Zkjadoon
2015).
Being updated to changing employment laws is a necessary task for the business
owners. Each country has their own local, state and federal laws and each and every
businesses are categorized according to their service and sectors. Therefore, laws are
also made differently according to their different categories, size or structure, service
and work. The EU has its own law compared to other Asian countries. Every
organizations are obliged to follow the law to remain in the business and for the
competitive advantage. Similarly, rules and regulations must be followed by both
organization and workforce to maintain the position in challenging businesses world.
Training and development of the workforce is the common problem faced by HR
in many companies. With the changes in work performance and advancement in
technologies, old workforce needs changes and development in themselves. Employees
will learn new skills and become more productive and loyal. New technologies will
improve the work performance (Atlas staffing 2019).
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Recruitment is the most challenging and difficult task for HR managers. Hiring the
right person for the right task and in the right time is quite difficult because it is
impossible to know if a candidate is good or not. It is really difficult to know the
person’s loyalty until they have worked in a company for some period. Similarly,
retaining talented employees is costly because of the competition and huge search of
talented employees (Atlas staffing 2019).
Individual challenges are related to employees themselves individualistically.

Organization is fully depended on the manpower. The measurement of output is related
to greater output, higher productivity. That is why motivation and communication inside
an organization plays an important role in an individual’s work performance. Some of
the individual problems are: Empowerment, ethics and social responsibility and brain
drain (Zkjadoon 2015).
Empowerment of an employee refers to the individual control over their own

work. Empowerment gives employees an independence of decision making and taking
responsibility and control on their work. In conclusion, employee empowerment
improves and increase the productivity and makes employee’s responsible (Zkjadoon
2015).
Ethics and social responsibility are both important part for an organization. Ethics
can be defined as a moral principles or values of an individual whereas social
responsibility refers to the legal responsibilities. Ethical issues in an organization are;
diversity, job security, fair pay, confidentiality. Social responsibility issues are:
prioritizing health and safety issues, providing additional trainings, benefits, counselling
etc. (Zkjadoon 2015).
Nowadays, the issue of brain drain is most common because of certain things like
money and good facilities. In a business world there are always competitors besides.
Brain drain can be defined as a situation where people leave particular place, country as
well as their own profession for another place, country and profession that gives them
better payment and good lifestyle 29 (Zkjadoon 2015). It is common to hear higher-level
employees leaving for better remuneration and these things are becoming crucial issue
in the higher technology companies (Zkjadoon 2015).
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3.8 Practices of HRM Strategy

Strategy refers to planning about the future (Kearns 2010, 1). The establishment of
any business organizations is to achieve a certain goal. For that reason, there is always
some strategic plans made by executives to reach that goal. In a business world it is
known as competitive advantage. Every organizations profitable or non- profitable, large
or small, these all have some objectives to achieve through the well-planned strategies.
Plans and strategies are made for future achievements.
In a business world where there are many competitors, Strategies works as a
company’s strength corresponding to that of competitors (Kearns 2010, 1). People
management or Human management is not an easy task. There should be lots of
experiences with thousands of people before working in HRM because each and every
individual are different. Similarly, it is a very tough task to make people work according
to strategies and plans. Consequently, different serious issues yield in an organization
when strategy should be implemented to the people. Thus, human behavior in terms of
future strategy is most of the time based upon the predictions. And as we know that
predictions are least based upon the information’s or accurate analysis, yet it is not
always sure that organizations will enjoy the supreme level of success (Kearns 2010, 1-
2). As a fact, in 2008-2009 global credit crunch many experts such as investment
analysts, financial directors, economic professors came to have a questionable situation
when the prediction went wrong (Kearns 2010, 2.) One wrong strategy for a company is
always a wrong step.
HR strategy is mainly focused for the welfare of the Human resources and
organization’s success. Business strategy have to have fully unified HR strategy such as
Corporate Social Responsibility (CSR), primary influence on the individuals or group of
people, diversity and business ethics for the development (Kearns 2010, 3-5). While
devising the HR strategy plan making it into the implementation is the tough job
because of uncertainty. HR- business strategy not only works with the company’s plans,
but also business ethics.
Motivation is the key to a successful HR strategy. While developing the strategic

plan HRD should always focus on people and their needs. Competitive salaries,
promotion
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opportunities, open-door policy, clear and regular communications and training and
development are some to the tools that helps to maintain the strategic HR practice
(Poppulo 2018)
3.9 The following are some basic limitations:
 Uncertainty of future
The future of all business organizations largely remains uncertain. This is because many
social, political, technological and financial factors can affect their functioning. These
factors end up affecting HRM as well because they dictate employment.
 Problems of surplus staffing

Whenever an organization is over-staffed, HRM provides solutions like termination of
excess employees, VRS, etc. This, in turn, negatively affects existing employees as the
threat of job termination looms on them all the time. Such negative psychological
pressures can generally make employees inefficient.
• Conservative attitudes of top-level management

The top-level management of many organizations often possesses a conservative
attitude in functioning. It can be reluctant in changing its own ideas and beliefs to
accommodate the quirks of employees. This can create hindrances for managers in
employing HRM practice should have the support of top level management. The change
in attitude at the top can bring good results while implementing HRM. Owing to passive
attitude at the top, this work is handled by personnel management people. Unless there
is a change in approach and attitude of top management nothing remarkable will
happen.
• Time-consuming
HRM generally requires managers to collect all sorts of information from employees
with respect to their functioning. Collecting all this data from all departments can be
highly time-consuming.
• Expensive
In order to facilitate an organization in functioning effectively, HRM suggests solutions
like training, VRS, bonus, perks, etc. Therefore, implementing HRM solutions can be
highly expensive too.
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 Improper Actualisation:
HRM should be implemented by assessing the training and development requirements of

employees. The aspirations and needs of people should be taken into account while
making human resource policies. HRM is actuated half-heartedly. The organising of some
training programmes is considered as the implementation of HRM. With this,
management’s productivity and profitability approach remains undisturbed in many
organisations.
 Inadequate Information:
Some enterprises do not have requisite information about their employees. In the absence
of adequate information and data base, this system cannot be properly implemented. So
there is a need to collect, store and retrieval of information before implementing human
resource management.
In many organisations, even the professionals misunderstand HRM as synonymous with
HRD. Some class room training programmes are generally arranged, which are called
HRD programmes. These programmes are understood as human resources management.
Such casual class room programmes are not the actual HRM programmes.
Even a well planned and executed HRD programme is not HRM. HRD is only a part of
HRM which is an integrated approach to management. Undoubtedly, human resource
management suffers from such limitations. But the impact it has made on the managerial
effectiveness has been spectacular wherever it was introduced. Actually speaking a real
need exists in every Indian organisation for an HRM approach.
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3.10 FACTORS AFFECTING ETHICS IN BANKS
• The study found that younger employees had a higher level of ethical
consciousness than older employees. In addition, it was observed that the longer
one worked for an organisation, the more one is likely to take job security as a
priority; this could lead to overlooking or rationalising unethical behaviours
• Trust & transparency of business, freedom of choice & accountability.
• Lack of quailed bankers, breaking of guidelines, lack of proper ethics training,

frauds & other malpractices
• Issues idented for focus – social banking, green banking, ethical banking, global
banking & agro banking
• Growing presence of competition, meeting high expectations & demands of

customers, complexities of bank operations
• self-interest, unethical corporate administration, money laundering
3.11 ETHICAL LAW IMPLEMENTED IN BANKING SECTOR
Article 1 (General Provisions):
The basic purpose of these Principles of Banking Ethics intended to be applied in all
kinds of affairs and relations of banks with each other or with their customers,
shareholders and employees, and with other organizations is to assure sustainability of
the existing reputation and reliability of banking profession in the public, and to enhance
and maintain such reputation and reliability feelings termed as professional dignity, and
to protect and maintain stability, consistency and confidence in banking sector. For the
purposes of these Principles, the word “bank” refers to the Association-member banks,
and the word “Association” stands for both the Banks Association of Turkey and the
Participation
Banks Association of Turkey.
Article 2 (Legal Grounds)
These Principles of Ethics are issued in reliance upon the provisions of second
paragraph of Article 75 and subparagraphs (c) and (e) of Article 80 of the Banking Law
no. 5411.
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Article 3 (General Principles)
Not only for the purposes of protecting the rights and interests of savors, and assuring
confidence, stability and consistency in fiscal markets, and ensuring effective operation
of deposit, credit and payment systems, and preventing transactions and practices which
may lead to material damages and losses in economy, but also with a view to
supervising the public benefits and social utility and protecting the environment, banks
are required to act in tandem with the general principles outlined hereinbelow.
• Integrity:
• Neutrality:
• Reliability:
• Transparency:
• Supervision of Public Benefits, and Respect to Environment:
• Fight Against Laundering of Proceeds of Crime and Combat Against
Financing of Terrorism:
• Information Abuse:
Article 4 (Relations With Public Entities and Organizations)
In their relations with public entities and organizations, the banks act in line with the
integrity, accountability and transparency principles, and take care of disclosure of all
information, documents and records as may be requested for audit and control purposes
pursuant to the applicable laws accurately, completely and timely.
Article 5 (Exchange of Information)

Exchange information of every kind with each other accurately and systematically to the
extent permitted by the applicable laws
Article 6 (Personnel Movements)

Refrain from all kinds of actions and practices that may pave the way for unfair
competition in employment-related matters; and Save for the freedoms of contract and
movement in employment pursuant to the Labor Act and other relevant laws and
regulations, elaborate to ensure that their employment does not cause any interruption in
services of other banks; and 4 Act honestly and objectively when providing information
requested about their ex-employees by other banks; and Take all kinds of actions in
order to ensure that their employees who have previously worked in other banks
perform their job duties in compliance with their secrecy and non-disclosure obligations
as per the relevant banking regulations
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Article 7 (Competition)
Consider the competition as a legitimate race among all relevant entities operating in the
banking sector which assures freedom in economic decisions, and to this end, in their
activities and operations conducted within free market economy, beside safeguarding
their own interests, they abstain from statements and behaviors causing unfair
competition, within the frame of the principles of:
a) sustainability of general trust in banking industry;
b) endeavoring for development of banking industry;
c) maintenance of marketplace atmosphere required by competition laws.
This principle is not only valid for banks as legal entities, but also applicable on
statements and behaviors of employees of banks. While providing services to their
customers, banks cannot offer or provide any benefits to an employee of another bank.
Article 8 (Advertisements and Promotions)

Both in their statements and disclosures pertaining to their financial situation, and in
their advertisements and announcements for publicity, promotion and marketing of their
banking products and services, they comply with the laws and regulations and public
morality, and behave honestly and realistically, and abstain from any kind of behaviors
which may harm the reputation of banking profession; and In their advertisements,
statements and promotions, do not ever use any expressions, terms or phrases
denigrating other entities and organizations or products and services of other entities and
organizations.
Article 9 (Information of Customers)

Give accurate, consistent, complete and timely information in compliance with the
limitations stipulated by laws at each stage and in all aspects of their service relations,
with regard to all kinds of products and services offered to their customers
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Article 10 (Customer Secrets)

Are under obligation to keep in strict confidence all kinds of information and documents
relating to their customers, except for persons and entities clearly authorized by laws to
request information and documents
Article 11 (Service Quality)

Consider and treat the service quality as a condition precedent of satisfaction of the
customer needs, demands and expectations by high-quality services, and try to ensure
that technological infrastructure and qualified human resources, as two basic elements of
this concept, are used in accordance with the goal of continuous development of service
quality; and Provide services of the same quality and same level to all of their
customers; provided, however, that determination of target markets and differentiation
of organizational structure and product range according to the target audience, or
showing different approaches to customers of separate risk groups cannot be interpreted
or construed as a discrimination among or a categorization of customers
Article 12 (Customer Applications)

Establish an efficiently and effectively operating system capable of responding to all
kinds of questions of their customers with regard to services, and inform their customers
about that system; and Inquire the causes of their disputes and conflicts with customers,
and take the required actions and measures for non-repetition thereof, and correct
improper practices causing complaints by also remedying the customer dissatisfaction,
and take the required actions and measures for non-repetition thereof
Article 13 (Security)
Accept that the term “security” does not only cover the precautions and measures
aiming at protection of the bank’s service locations and premises against all kinds of
attacks and offences, but also extends to prevention of all kinds of breaches that may
technically cause harm to services offered to customers in the banking sector; and Take
all technical and legal actions of any kind aimed at security of transactions and
information in all kinds of
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service atmospheres due to changing service channels and services developing parallel
to technological advancements and electronic banking, and keep their customers
informed about the actions taken by them and the actions required to be taken by their
customers.
Article 14 (General Qualifications and Employees)

Banks are expected to employ only persons having the knowledge, know-how and
responsibility feeling required for their job duties. Banks cannot recruit any personnel
who do not bear the legal qualifications sought for by the applicable laws and
particularly the Banking Law no. 5411.
Article 15 (Recruitment and Career Development)

Banks attempt to offer equal opportunities to all of their employees both in recruitment
and in career development, without any discrimination among employees. Departing
from the principle of best management of human resources, they provide all
opportunities to their employees for their access to the knowledge level required by
contemporary world and banking profession. In professional development and
promotion of their employees, they take into consideration not only knowledge, skills
and personal achievements, but also commitment to the Principles of Banking Ethics
and diligence in implementation of the said principles.
Article 16 ( Principles of Representation and Work Environment )

They issue and impose internal regulations requiring their employees to be clean and
well-groomed in conformity with reputation of banking profession and conscious of
representing the bank. They take actions for enhancement of motivation of their
employees in all service units, and for provision of services under better conditions, and
ensure the creation and maintenance of a healthy and safe work environment. They take
all kinds of measures in order to prevent any kinds of harassment, and especially
psychological harassment (i.e. mobbing), and in the case of such accusations, carry out
the required investigation thereon. If the investigation reveals a psychological
harassment (i.e. mobbing), they take all remedial measures of any kind, and apply all
possible sanctions to the extent allowed by the applicable laws.
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Article 17 ( Working Hours )

Banks show maximum effort in order to employ an adequate number of employees in
line with the workload, and to organize their employees in such manner to get the
maximum efficiency during the normal working hours, and not to go beyond the normal
working hours, and if and to the extent overtime work is needed, to show respect to and
safeguard the rights of their employees, and to make sure that their employees regularly
take their annual leaves.
Article 18 ( Rights of Employees )

Banks do their best in order to recognize and provide timely and completely all rights
of their employees arising out of the Labour Act and other applicable laws and
regulations, and particularly the prevention of unfair termination of employment
contract.
Article 19 (Professional Rules and Ethical Principles To Be Followed

By
Bank Employees)
Bank employees are obligated:
• To comply with the pertinent applicable laws in the course of performance of

their job duties.
• To keep their customers informed about benefits and risks of products and
services offered to them
• To provide neutral and fair services to customers buying the same service
• Not to disclose any information about banks or their customers, which come to
their knowledge due to their positions and duties, to any person other than the
authorities and bodies clearly authorized by the laws to request such information
• Not to lead to any loss of reputation of the bank through their works and
behaviours
• Not to directly or indirectly engage in any business operations which require

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• Not to breach and violate the justice, honesty, integrity, reliability and social
responsibility principles
• To communicate with other employees carefully and respectfully and enter into
cooperation with them for joint purposes or motives, in the course of
performance of their job duties
• Not to use the bank’s assets, properties and resources inefficiently and for
nonintended purposes
• Not to derive any personal benefits for themselves or for others out of their own
work environments or their customers’ facilities by using their job positions and
duties
• To immediately refuse, and report to superiors and authorized bodies, any offers
or propositions of personal benefits
• To direct potential customers first and mainly to their own bank

• To avoid entering into non-ethical relations with customers, such as
indebtedness, personal guarantee and opening of joint accounts
• Not to accept any gifts contrary to customs and usage from existing or potential
customers
• To be accountable with regard to their job duties during performance of banking

services
• Not to assume any duty in any other private or public entity without a prior
consent of their bank, except for associations, foundations, cooperatives and
similar other organizations
• Not to cause harm to reputation of banks and other financial institutions, and not
to attempt to denigrate and humiliate their business partners, shareholders,
employees and customers, in media and social media, profiles, accounts or
postings, by using their own identity, or by concealing identity or using
misleading identities
• Not to take actions binding on their bank, and not to make deceptive and untrue
statements, by exceeding their powers in the course of performance of their
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Article 20 (Development of Principles of Banking Ethics)
Banks may at any time submit proposals to the Association’s Board of Directors for
development and if required, amendment or revision of these Principles of Banking
Ethics.
Article 21 (Right and Duration of Application)

Banks, bank employees and bank customers are entitled to file an application. However,
an application cannot be filed on the ground of breach of the Association’s Ethical
Principles through acts and behaviours regulated and sanctioned by the Banking Law
and other pertinent laws, also including disputes pending in or already resolved by
juridical authorities and courts. Applications not filed within one year following the date
of occurrence of the underlying event are forfeited.
Article 22 (Application Procedures)

Applications are filed in writing to the Association. Applications clearly contain all
details, information and documents regarding the alleged breach of these Ethical
Principles, and which article of these Ethical Principles as alleged to be breached is also
stated in the petition for application. The allegation of breach, being the subject matter
of application, is indicated concretely by reference to person, time and location.
Article 23 (Acceptance and Investigation of Application)

The applications are checked by the Association as to description, essence, information
and documents. Applications deemed unfit in terms of description, essence, information
and documents are not processed, and this is duly notified to the applicant clearly and
understandably, together with rationale of refusal. Applications deemed fit are escalated
by the Association to the Association’s Ethical Commission. Composition and working
procedures and principles of the Association Ethical Commission are determined by the
Association’s Board of Directors.
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Article 24 (Actions Regarding Decisions of Association Ethical

Commission)
The Association Ethical Commission may either not find any breach of Ethical Principles
with regard to a processed application, or decide to escalate and present such application
to the Board of Director. Decisions of the Association Ethical Commission as to
applications determined not to be in contradiction with the Ethical Principles are
communicated to the relevant sides in writing.
Article 25 (Determination and Sanctions of Breaches)
With respect to applications escalated by the Association Ethical Commission to the

Association’s Board of Directors, the Board of Directors decides whether these Ethical
Principles are actually breached or not, and such decision is communicated in writing to
sides. If the Board of Directors determines a breach of the Ethical Principles, those who
breach these Ethical Principles are reported to the Banking Regulation and Supervision
Authority, and the provisions of third paragraph of Article 81 of the Banking Law no.
5411are applicable on them.
Article 26 (Enforcement)
These Principles will be enforced by the Secretariat General of the Association.
Article 27 (Effective Date)
These Principles of Banking Ethics shall become effective as of the date of publishing.
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CHAPTER 4: RESEARCH METHODOLOGY
4.1 INTRODUCTION
Research methodology is a method of collecting the data or information to give meaning

to the research. The term research methodology is formed by two different words
‘Research’ and ‘Methodology’. The defin ition of research varies from person to person.
As a process research is a series of activities that are linked with starting from the
identification of the topic or the problem followed by hypothetical questions, data
collection techniques, processing and analysis, selecting units of study and collecting data,
analysing the hypothetical questions and finally presenting all the process in the form of
a report. However, methodology is defined as a system of methods used for the study.
According to Creswell (2014, 31) research method is the process of data collection,
analysis and interpretation.
According to the Business Dictionary, Research methodology is defined as the process of
collecting information by the help of using various methods such as interviews, journals,
surveys, books, etc. for generating facts and figures and also improving the decision-
making process in business world (Business Dictionary 2018). Research methodology
helps to develop the decision-making skills and gives more knowledge of scientific
attitude and disciplined thinking.
Different types of research methods are used in conducting research amongst which
qualitative and quantitative research are the two widely used research methods.
Quantitative research is expressed and measured in terms of quantity. Statistical data is
prepared in a numerical order. In this method, questionnaire forms are prepared, and
respondents are asked to fill up the forms to make the precise measurement with the help
of questionnaire. This research is done by comparing the trends and focusing on daily
life experiences.
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4.2 METHOD USE FOR RESEARCH METHODOLOGY
• Methodology used in the introduction part is the collection of raw data and
primary data.
• Primary data collected through the employee of a bank

• Convenient sampling method is used select respondants
• For analysis interpretation suitable statical technique are used like graph, tables
etc
4.3. QUALITITAVE RESEARCH
• Qualitative research method is based on the introductory research.

• This method is used to get the information in more detailed way concerning with
people’s thoughts, opinions motivations and reasons.
• The result is not measured in numeric or statistical order.

• This method focuses on discussions with targeted group of people, interviews with
participants or an individual.
• This research method is very effective because it reveals the ethical part of any
problems or cases.
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CHAPTER 5 : DATA INTERPRETATION
5.1 INTRODUCTION
 What Is Data Interpretation?
• Data interpretation refers to the process of using diverse analytical methods to

review data and arrive at relevant conclusions. The interpretation of data helps
researchers to categorize, manipulate, and summarize the information in order to
answer critical questions.
• The importance of data interpretation is evident and this is why it needs to be done
properly. Data is very likely to arrive from multiple sources and has a tendency to
enter the analysis process with haphazard ordering. Data analysis tends to be
extremely subjective. That is to say, the nature and goal of interpretation will vary
from business to business, likely correlating to the type of data being analyzed.
While there are several different types of processes that are implemented based on
individual data nature, the two broadest and most common categories are
“quantitative analysis” and “qualitative analysis”.
• Yet, before any serious data interpretation inquiry can begin, it should be understood
that visual presentations of data findings are irrelevant unless a sound decision is
made regarding scales of measurement. Before any serious data analysis can begin,
the scale of measurement must be decided for the data as this will have a long-term
impact on data interpretation ROI. The varying scales include:
• Nominal Scale:
Non-numeric categories that cannot be ranked or compared quantitatively. Variables

are exclusive and exhaustive.
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 Ordinal Scale:
Exclusive categories that are exclusive and exhaustive but with a logical order.
Quality ratings and agreement ratings are examples of ordinal scales (i.e., good, very
good, fair, etc., OR agree, strongly agree, disagree, etc.).
• Interval:
A measurement scale where data is grouped into categories with orderly and equal
distances between the categories. There is always an arbitrary zero point
• Ratio: contains features of all three.
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1. Age group
Age No. of Employee

Group
22-26 37
27-25 10
26-45 10
As per the above pie diagram there are 37 people form age group 22-26 i.e
62.7%, 10 people from age group 27-35 and 10 people from age group 36-45.

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53
2. Gender
Gender No. of employee
Male 42
Female 15
As per the above pie diagram, there are 42 Males working in bank i.e 71.2% and
15 females working in the bank i.e 25.4%.
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3. How good is your HR department?
Remark No. of Employee
Poor 3
Good 29
Very Good 14
Excellent 9
No 2
As per the diagram , the responses for the above question are
Among 57 employee only 9 employee i.e.15.8% were fully satsified with their HR
Department and were as 14 employee i.e 24.6% , Good is 50.9%.

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4. Do you get salary on time ?

Yes No
54 1
As per the pie diagram , the responses for the above question are 54 Employee get the
time i.e 96.4% and 1 employee don’t get salary on time
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52
5. Does the bonus and incentive are given by the bank on the time ?
YES NO
50 7
Out of 57 responses the 50 employee get salary and incentives on time i.e 87.7% where
Don’t get salary and incentives on time
as 7 employee i.e 12.3%

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6. Does your HR dept has/had ethical HR Policies?
YES NO
54 3
Out of 57 responses the 54 employee working in bank their HR Department follow
ethical policies i.e 94.7% where in 3 bank where the employee working their human
resource department follow the less ethical policies

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52
7.Does all the rules and regulations are followed strictly?
YES NO
50 4
Out of 54 responses the 50 employee Working in bank at their place rules and regulation
are followed i.e 92.6% and were as 7.4% 0f banks don’t follow rules and regulation

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52
8.What issues as an employee have /had you faced with your HR

department?
Out of 54 responses following are the issues faced by the employee by their human
resources department of bank which are follows:-
ISSUED FACED NUMBER 0F EMPLOYEE
Compliance with laws and 8

regulations
Healthy and safety 4
Change management 14
Landing top management 5
Retention 6
Monitoring productivity and performance 13
Compensation management 4
According to given pie diagram we come to know that most of the 25.9% of bank
employee faced the problem of change management which has been highlighted with
red colour
9. How often does you Bank's HR department follows ethics?

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52
Remark No. of Employee
Situationally 10
Frequently 17
Occasionally 5
Allways 23
According to given pie diagram we come to know that how does the bank behave
depending upon the situations and how they follow the ethics most of the bank human
resources department react and follows ethic always i.e 41.8%
10. How satisfied you were with the ethics followed by your HR dept
in management?

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52
According to given Graph we come to know that the

Y axis represent the satisfactory level of the employee
Among my 55 response collected by bank employee only 17 i.e 30.9% of employee are
fully satisfied with their human resource department and rest you all can know from the
above given graph

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11. How good was your HR dept is/was in taking decision on an

conflict?
This question is basically personal response type question among 41 response here are
the few best response which has been given by the bank employee of different bank
working in Mumbai and this data has been collected between region between Dahisar to
Andheri which are as follows:-
Employee name Brinda Dodie working in state bank of India (SBI)She says that her
HR Dept provide many policies and take fair decision regarding the rewards and
incentives
Employee name Surya Nair working in Axis bank she says that her HR Dept is good at
Balancing and clearing the problem easily
Employee name Sandeep Sharma working in state bank of India (SBI) he says that his
HR Dept reacts Depending upon situations
And reaming employee have also shared their views and opinions in positive manner as
well as in negative way too.
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CHAPTER 6 : SUGGESTIONS & RECOMMENDATIONS
CONCLUSION:-
We can conclude that the objective of the project was to study the problem faced by the
employee and and to study the ethical human resource mangement strategies.
On the basis of survey conducted from employee. We come to know that employee
faced the problem due to Change Mangement and Monitoring productivity and
performance. As you can refer to above data and from the above data we also come to
know that how does bank react depending upon situation to follow their ethics and also
rules and regulations we come to know from survey that most of banking employee are
fully satsifed with their HR Department.
On the basis of review of literature we can conclude that the common thread and
observation in most of studies focuses on customer satsifaction in bank related to the
ethical practice.Customer feel more secure and comfortable in entrusting their hard
earned-money to those bank were they feel safe.In the addition I had come to know that
the main reason of bank failure is non-addherence or lack use of code of ethic.
Therefore according to me employee is equally responsible to express his or her
excpection and need from the top mangement and HR Department
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64
 SUGGESTION & RECOMMENDATIONS
 According to me human resource department should maintain transperancy

between employee and manger regarding changes
 Also try to come out with new policies for the employee benfits scheme should
be introduce
 There should be growth opportunity for young employees
 They should get recogniation or recognized by the top mangement of banking
sector
 The employee facing any problem or there is any kind of missunderstamding
among the employee and employer their should be good employee engement
team
 Fair judgement should be provide to employee working in your banking
organization
 They should get equal opportunity to share their view and opnion in decision
making
 According to me banking sector should have effective HR Team
 They should be aware about changes brought in banking sector
 They should be encourage to participate in activities carried out by the bank it
can be any way for example bank can organized the sport events,career
consuelling program etc.
 Therefore, it is suggested that for long-term profitability and higher customer
satisfaction, banks should focus more on following the code of conduct, thus
improving ethical practices.
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 BIBLIOGRAPHY AND ANNEXUERS
Bibliography
• A Alawiye-Adams, A. (Jan 2018). Ethics and Professionalism in the Banking Industry, a
Case Study of Nigerian Banking Environment.
• Dogra, A. D. (2014). Sustainablity and Ethical Banking: A Case Study Of Punjab National
Bank. Mumbai.
• Gupta, P. (2019). The role of Business Ethics and Ethical Issues of Marketing in Banking
Industry in India. Meerut.
• Joshi, D. K. (May 2011). A Study of Social and Ethical Issues in Banking Industries.
Udaipur.
• Relano, M. p. (July 2014). Banking with Ethics: Strategic Moves and Structural Changes
of the Banking Industry in the Aftermath of the Subprime Mortgage Crisis. Europe:
Journal of business Ethics.
• Shetty, D. P. (2014). Case Study of Yes Bank. banglore.
• Tripati, M. (2019). Impact of Corporate Social Responsibility on Performance of Public

Sector and Private Sector Banks in India. Delhi: From the director desk,83.
 WEBSITE LINK
• https://www.researchgate.net/publication/262144664_A_Study_of_Social_and_Ethica
l_Issues_in_banking_industry
• https://www.researchgate.net/profile/Vijay-Joshi-
14/publication/262144664_A_Study_of_Social_and_Ethical_Issues_in_banking_industr
y/links/02e7e536c68c515784000000/A-Study-of-Social-and-Ethical-Issues-in-
bankingindustry.pdf
• https://link.springer.com/article/10.1007/s10551-014-2274-9
• http://indusedu.org/pdfs/IJREISS/IJREISS_2482_53223.pdf
• https://www.researchgate.net/publication/350037170_Ethics_and_Ethical_Practices_i
n_Banks_A_Review_of_Literature
• https://www.researchgate.net/publication/262144664_A_Study_of_Social_and_Ethica
l_Issues_in_banking_industry
• https://www.tbb.org.tr/en/Content/Upload/dokuman/136/Bankacilik_Etik_Ilkeleri.pdf
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 ANNEXURE: - GOOGLE QUESTIONER
A study of Ethical Human Resource Management in Banking

Sector
1.Name
________________
2.Age group
o 22 to 26 o
27 to 35
o 36 TO 45
3.Gender
o MALE o FEMALE
4.Contact
_______________
5. In which Bank do you work or had worked for?

_______________
6. How good was your HR dept?
o Poor o Good o Very good

o Excellent
7.Do you get your salary on

time ? o Yes o No
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8.Does the bonus and incentive are given by the bank on

time ? o Yes o No
9. Does your HR dept has/had ethical HR Policies ?
o Yes o No
10.How good was your HR dept is/was in taking decision on an conflict?

_____________________
11. Does all the rules and regulations are followed strictly? o Yes o No
12. What issues as an employee have /had you faced with your HR
department?
o Compliance with laws and regulations

o Change management o Compensation management
o Landing top management o Retention
o Monitoring productivity and performance
13. How often does you Bank's HR department follows ethics?
o Situationally o Frequently o Occasionally

o Always
14. How satisfied you were with the ethics followed by your HR dept in
management?
1 2 3 4 5 6 7 8 9 10
O O O O O O O O O O
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BACHELOR OF MANAGEMENT STUDIES

UNDER THE GUIDANCE OF

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I would like to acknowledge the following as being idealistic channels and

I would like to thank my Principal Dr. Jitendra K. Aherkar for providing

I take this opportunity to thank our Coordinator Prof.Suryaprakash Singh

I would also like to express my sincere gratitude towards my project guide

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 Human resource management (HRM or HR) :-

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A STUDY OF ETHICAL HUMAN RESOURCE MANAGEMENT IN BANKING SECTOR 6

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as payroll and benefits administration, but due to globalization, company consolidation,

The development of employee commitment through employee involvement and

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A STUDY OF ETHICAL HUMAN RESOURCE MANAGEMENT IN BANKING SECTOR 7

• The entire spectrum of ethical HR practice requires revolutionary changes if the

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A STUDY OF ETHICAL HUMAN RESOURCE MANAGEMENT IN BANKING SECTOR

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• Performance management and talent spotting: The HR management remains

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A STUDY OF ETHICAL HUMAN RESOURCE MANAGEMENT IN BANKING SECTOR

management team to have a look at the present and possible future

 Achieve organizational goals

The proper connection between individuals is a must to ensure productivity. To

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A STUDY OF ETHICAL HUMAN RESOURCE MANAGEMENT IN BANKING SECTOR 10

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 Training and Development

Effective employment is highly dependent upon the training practices. Providing

There might be difficulties such as planning, scheduling, training sessions, and

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A STUDY OF ETHICAL HUMAN RESOURCE MANAGEMENT IN BANKING SECTOR 11

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Employee experience needs to be carefully attended. Keeping your employees retained

 Data and compliance

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1.1 Objectives of the study

• To study the ethical human resource management in the banks.

1.2 Methodology use to collect data

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 HRM in Employee Welfare:

It also relates to supervision, employee counselling, establishing harmonious relationships