Corporate Social Responsibility – A Case Study on Strategies of Indian Private and Public Sector Banks

Abstract

Purpose: The banking industry in the service industry sector in India contributes to the economy of the country by mobilizing the deposits and providing credits to other industries, industry sectors, and individuals. As per new government policy, private banks mandatorily and public banks are voluntarily required to contribute to corporate social responsibility fund of 2% of the profit on social service activities to address a variety of societal needs. It is interesting to know how Indian banks have utilized CSR funds by means of smart decision-making. It is interesting to compare the CSR activities of some selected public and private sector banks in India, to know their smart strategies for improving the organizational business benefits. Design/Methodology: This study identifies and analyses various social responsibility programs organized by selected banking organizations of India. The data and information used are obtained from websites of chosen banks, bank literature from different websites, banks statements, and related case studies. Findings: The government has declared that companies earning a profit of 500 crores or more should establish a CSR team that should contain three or more executives and one independent administrator to develop CSR guidelines and to handle the CSR activities. Based on the comparison of CSR activities between private and public sector banks, it is found that the CSR activities offered by private sector banks focused on directly supporting their customer services and CSR activities offered by public banks are indirectly supported their brand-building activities so that these two types of banks could get benefit in terms of customer satisfaction and promotion of their services to weaker sections of the society, respectively. Originality/Value: This research paper analyzes the role played by private and public banks in the effective implementation of their corporate social responsibilities by segregating the CSR activities into inbound and outbound activities. Paper type: Research Case study.