Corporate Social Responsibility (CSR) in the Banking Industry: A Model for Increasing Financial Performance

The banking sector is considered to be an important component in the financial services’ industry while banks are spending millions of dollars on corporate social responsibility (CSR). Many banks have created task teams to introduce the CSR concept properly so that to guarantee higher profits through CSR practices. However, a common CSR framework that can be adapted and implemented by commercial banks to achieve financial returns is still lacking, thus subjecting CSR as a philanthropic activity that is mostly applicable to developing countries. The dissertation uses two sets of data: primary data collected from bank customers, employees and managers and secondary data collected from banks’ financial statements and annual reports so that to develop a model that can be used to increase financial performance by banks through CSR. Using the IBM SPSS Modeler 22.0 and NVivo software, the dissertation provides the model, taking into account three pillars of CSR (economic, environmental and social) and three accounting based measures (ROA, ROE and PPE). The findings indicate a positive relationship between CSR and financial performance in commercial banks based on accounting measures. Therefore, better CSR practices lead to higher financial performance in commercial banks. Moreover, there is a moderating effect of the control variables on the relationship between CSR strategies and financial performance of commercial banks. Financial performance is dependent on solid socially responsible performance and investments in CSR positively affect profitability growth. Banks have specific departments responsible for CSR implementation. In addition, the results indicate that banks communicate their CSR practices via bank websites and annual reports and have significant budgets allocated for CSR-related activities. To better practice CSR, these banks observe professionalism, are shareholders-oriented and make their CSR practices completely voluntary. Relationship creation is the main objective of practicing CSR by banks. Image creation; financial returns; increase customer loyalty/base; contribution to sustainable growth; product and service quality; employees’ welfare; talent management; health management; community development; partnerships’ development; education development; advocacy for equality; life improvement and environmental management are the other objectives of banks’ involvement in CSR. The results indicated that CSR initiatives are mostly philanthropic. Furthermore, the dissertation’s contributions to scientific and practical fields are discussed in the penultimate chapter. Finally, limitations of the research and suggestions for future research are presented in the last chapter.

ISBN:	978-80-7454-802-4
EAN:	9788074548024
Počet stran	42 stran
Datum vydání	19. 11. 2018
Pořadí vydání	První
Jazyk	anglický
Vazba	e-kniha - pdf
Autor:	Felix Ondieki Kombo
Nakladatelství	Univerzita Tomáše Bati ve Zlíně
Tématická skupina	1 - Ekonomika
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