Discuss about the Corporate Governance and Ethics Responsibility.
Corporate social responsibility and Ethics in the bank policy covers the whole process that explains the benefits of the banking policies and its work towards the society. CSR is the integral part of the banks for making any formal policy as it represents the activities of the bank. Nantporth bank is a financial institution that provides the financial services to the customers and also follows the ethics and takes care of the corporate social responsibility as this bank is committed to the social and environment concerns in its operations and maintains the relationship with the stakeholders. The main objective of the CSR is to become a responsible banking aiming at strategic positioning and differentiator in the country by focusing on the all responsibilities towards society. This report talks about the CSR policy made for the Nantporth bank in order to survive in the market and to maximize the profits by contributing in the welfare of the society. The plan or CSR policy also associated some risks along with it so the proper implementation of the policy is very important.
In simple word the social responsibility stands for what a bank or any other business does for the benefit of the society. The CSR policy function helps to ensure the relationship of the activities with the ethical standards, spirit of the law and all the international norms. CSR also helps in the development of the economy by contributing towards maintaining the quality life of the workforce and family and society. The policy of CSR acts as a guiding document that helps to understand the CSR projects. CSR focus on the stakeholders of the bank to promote a positive image of the bank in the banking environment.
The CSR in the banking sector plays a role as it is not a charity, but creates shared value and contribution in the environmental benefits.
The formulation of a policy in the bank has two main aspects like: –
Nantporth bank is obliged to the society for the help and support in the Bank’s growth and development. The Bank has the belief that sustainable development cannot be made without the help of the customers and investors. The Nantporth Bank is committed toward the ethical stands and the stakeholder’s interactions. Nantporth bank has to continue working for the welfare of the society to make its strong position and to be a different among the other banks. The Nantporth Bank, like other Banks, also committed towards giving the monetary support for the development activities of the country by taking care of the environment and human rights. CSR is important by the banking sector because of its commitment towards the society to behave ethically. CSR also helps in the development of the economy by contributing towards maintaining the quality life of the workforce and family and society. The policy of CSR acts as a guiding document that helps to understand the CSR projects. The formal policy of CSR in the bank would work as a mechanism of self regulatory.
The scope of this policy is to relate all the activities of bank that focus on the fulfillment of the CSR. The policy of the banks is in compliance of the section 135 of the companies act and contains all the banking operations and also amendments could be taking place with the change of time (Dhingra & Mittal, 2014).
The Governance structure involves the CSR committee as the regulatory body that clear the concept and scope of the CSR banking activities for the bank and the committee of Nantporth bank is comprised of two non executive directors and one the independent director and all the team will work to ensure that compliance with the CSR policy.
The banking activities or the operations that aimed at the benefits of the society are many in number and all these corporate social activities are explained below: –
Education: – Education is very important for the children in order to survive in the corporate world. The banks need to provide the education and training to clear the basics about banking among the children. There are many banks, which have the training centers that provide free education and training for the students (Szegedi, et al., 2015). This is beneficial for society as it creates more interest among the children to become a part of the bank. To provide the job related training and higher education, it is very important to invest some amount of money in these banking institutions. Nantporth bank will continue to work with the state government and also with the non-profit organizations to get the best quality of employees for the banking sector. The main aim of this bank is to promote the education and employment enhancement skills among the people of the country.
HealthCare: – The other activity of the bank towards the society is to promote the healthcare of the people as this is also the biggest challenge for the country. The health care is promoted by the Nanthporth bank by creating awareness among the people about the health issues and the available facilities for resolving these issues. It is very important to consider these challenges to make the differentiation and new position in the market. The bank also offers now health policies to their customers to secure their family and to provide the free medical checkups. The Nantporth bank is focused on the development of the models that supports the healthcare in the society (Moharana, 2013).
Skill development and sustainable livelihoods: – The Nantporth bank emphasizes on the Improvement of the skills of the young generation to improve the standards of employability. The bank also plans to open the academy for the adults to provide the training for job-oriented skills.
Financial Inclusion: – As we all know that, to improve the economic situation of the low income population and it is important to focus to provide them some financial services. The other motive of the Nantporth bank is to reduce the income inequality in the economy (Federation, 2014). The bank would continue to expand in the rural area where the number of low income people is high and bank tries to expand its branches in the rural areas to make their financial services accessible to all the low income groups (PwC, 2012).
Employee Engagement in the CSR activities: – The Nantporth bank tries to encourage their employees to work for the betterment of the society (Hoang, 2014).
The bank had a highly profitable, wholly-owned asset management subsidiary, which offered mutual funds and money management services. The subsidiary had always considered maximization of profit. To achieve the goal of the bank, it is important to engage all the employees and stakeholders for the maximization of the profits.
To provide a CSR program, the bank need to focus the present support and the area of concern like Nantporth is facing the problem by the stakeholders for supporting the production of the alcohol and Tobacco (Wong, 2015). These activities are against the ethical standards of the company, that’s why the Nantporth bank need to make a program that focuses on the social responsibility. The following terms and conditions need to be followed by the employees or the stakeholders of the company: –
The Nantporth Bank will implement its CSR policy either directly or through the CSR committee that consists of a board of directors with the help of unions, agencies, bank officers or societies, or by the combination of all by the board of directors. The policy of project’s rules should be implemented for all the people working in the organization (Kytle & Ruggie, 2005).
There is the possibility that the CSR policy of the Nantporth Bank will create Risks. There are many chances that the corporate social responsibility of the policy creates the negative impact for the banking sector. The risk causes may be related to the reputation and image of the bank, financial risk, legal risks and many more risks associated with the governance. The reason of the risk involvement in the policy could be the shared value, sustainability or the Corporate responsibility of the Nantporth bank (OECD, 2014).
There are few risks are given below that occurs because of the existence of the corporate social responsibility: –
The CSR policy implementation will be successful if the policy or program of CSR should take care of some of the points. The CSR policy leads to better results only if the governance structure is strong and follows some ethical standards, transparency and accountability. The stakeholder engagement should be enhanced to avoid the risks. It is very important that all the employees and shareholders should be treated equally in the bank to promote gender inequality and wellbeing of all the employees. Human rights should be protected and maintained. The involvement of government is to implement the corporate social responsibility policy on national and international platforms (Yeung, 2011). The bank should build communities for the sustainable development. Environmental responsibility of the corporation is very essentials so as to promote this, Nantporth bank need to take some initiatives. It is mostly recommended that the communication should be very strong. The Objectives and the goals of the company should be communicated or informed clearly to the internal as well as external stakeholders. It is recommended that all the CSR activities and expenses should be checked and audited by the Auditors of the Nantporth. The profits generating from these CSR projects or policy should not be the part of the profits of the company (Matei & Voica, 2013).
Conclusion
From the above study, it is concluded that for every banking sector, it is important to make a corporate social responsibility policy to make a difference in the society and these policy rules should be followed by the each employee of the bank. As this report explained about the purpose of making policy and how the CSR policy or program should be made to avoid the serious issues related with the stakeholders. The banking sector is very vast and it is growing rapidly day by day. Every person goes to the bank for the management of their money or funds, to avail the financial services like home loans, vehicle loans and education loans, or to invest their money in the mutual funds, government securities etc. All these services provided by the Bank are in the favor of the people of the society. This report clears the fact that the banks are committed to make the CSR policy in compliance to the social environment and also the CSR policy promotes the education, healthcare, job oriented skills and financial services. For the successful implementation of the CSR policy, it is important to follow all these points and recommendations. Nantporth bank is a highly profitable bank and provides the services of managing the money of the people and the motive of this corporation is to maximize its profits by implementing the best CSR policy in order to make best place in the demanding market. As already discussed above, the education, healthcare, skills of the youth, and financial inclusion are the advantages of the corporate social responsibility.
References
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Dhingra, D. & Mittal, R., 2014. CSR Practices in Banking Sector. Global Journal of Finance and Management., 6(9), pp. 853-862.
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