INTRODUCTION:
Corporate social responsibility is the continuing commitment by business to achieve commercial
success in ways that honour ethical values, address legal issues and contribute to economicdevelopment while improving the quality of the workforce and their families as well as the local
community and society at large. Indeed, the idea of social responsibility is not new to this age;
rather it has been around as long as businesses have existed. Sometimes it comes in the shape of
caring owners who provided housing, paid the workers who are off due to sickness or otherwise
in form of attempts made to provide ease and comfort to the employees lot. Although many such
voluntary social measures have become legal requirements, a number of business leaders have
gone further ahead by utilizing their wealth to improve the living conditions of many people in
the society. Simultaneously, a shift is already occurring from traditional philanthropy to
wholesome community development among the more progressive of the companies. Financial
System is the most important institutional and functional vehicle for economic transformation of
any country. Banking sector is reckoned as a hub and barometer of the financial system. As a
pillar of the economy, this sector plays a predominant role in the economic development of the
country. Thus the banking sector has been playing a significant role as growth facilitator. In
recent years corporate social responsibility has become an important issue at global level. The
concept of corporate social responsibility recognizes as commitment of an organization to
operate in a socially responsible manner. It takes into consideration the social and environmental
implications of corporate financial decisions. It is also associated with corporate governance and
ethical business procedure. The three keys to an effective CS R policy are commitment, clarity and congruence with corporate values. Clarity is all-important because social responsibility is a broad term, and it needs to be debated and hammered out to meet each company’s circumstances. Congruence
is about ensuring that the company’s attitude to its responsibilities towards society is
consistent with the way in which it runs the whole business, i.e.. its values and culture.
An important aspect of corporate social responsibility is Sustainable Development. It is
broadly defined as the advancement of economic development while maintaining the quality
of environmental and social systems. Incorporating Environmental & Social (E&S) issues
into development is important because environmental resources provide a basis for social and
economic development. The principles of sustainable development are important in all
industrial and commercial sectors, as all activities have the potential to influence social and
environmental welfare quality. The financial sector is of particular importance, as this sector
is able to affect many projects and the development trends that result from them.
DISCUSSION:
Banks should make sure that the companies for which they are financing or investing incur
the risks that the impacts due to their anti-environmental acts create can be legal, financial,
and reputation al, and banks themselves are increasingly accountable for the effects their
portfolios have on the environment and society.
According to me banks are not fulfilling there duty of corporate social responsibility because of lack of resources and certain ups and downs in the market.The financial institutions have to see the environmental and social sustainability of the projects of the company, coming for financing. Banks should charge extra fees or fines from companies which are causing environmental harm to the society.
CONCLUSION
Banks are beginning to recognize that they have a social responsibility to fulfill as they
emerge from the shadow of traditional banking. As per Relatively indirect nature of their
environmental and social impacts, banks need to examine the effects of their lending and
investment decisions. Incorporating environmental and social criteria into business decision
making can reduce the impacts of operating activities.
