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Name: Eric Leaw

Journal title: Corporate Social Responsibility in Commercial Banking - A Case


Study from the Czech Republic
Author name: Burianov Lenka, Paulk Ji
Vol. 6, Issue 1, March 2014

Corporate Social Responsibility in Commercial Banking - A Case Study from the


Czech Republic
1.1 Objectives
It has becomes a highly typical need for integration of moral principles in the banking
business. Corporate Social Responsibility has widely used in banking sector with the
objective to maximize the company positive impact and minimize the company
negative impact towards its stakeholders because banking sector involve in the
transaction of money which means this business sector require a high value in
credibility because money is the main object of transaction or business that involve
between the company and its stakeholders. Therefore, to have a positive image
towards the company is very important because customers will choose a reliable and
has a good brand image bank instead of other competitors in the market. This research
has to been done to find out or to study what is the relationship between Corporate
Social Responsibility and the commercial banks in Czech Republic and what has been
done by the selected banks of researcher. Researcher has used CSR index as the
measurement to find the level of involvement of commercial banks in Corporate
Social Responsibility.

Methodology
2.1 Data Collection
In collecting the data, most of the data was collected through using secondary data
such as annual report of the company, theories, information and facts from published
journals by several authors. Other than using secondary data, there are some primary
data such as questionnaire through the employees of the selected commercial banks in
order to get more reliable and accurate information.
There are four basic pillars of Corporate Social Responsibility Basic such as
Economy, Environment and Social Responsibility were evaluated separately and
divided into eight main areas such as Management of CSR, Direct economic effects
on a community, Indirect economic effects on the community, Human Rights, Social
Policy, Employment, Consumer Protection and Environmental Policy.

2.2 Research Location


The research location is based in Czech Republic, most of the data and information
were collected through secondary data and it is mostly based on the data from the
selected commercial banks annual reports that can easily obtain from the companys
official websites and some previous research that has been done by other researchers.
Hence, there is no any specific location in doing this research.

3.1 Summary
In measuring the level of Corporate Social Responsibility of commercial banks in
Czech Republic and there are four commercial banks has been selected in which are
esk Spoitelna, eskoslovensk Obchodn Banka, Komern Banka and GE Money
Bank.
There is a significant relationship between Corporate Social Responsibility and
commercial banking. According to Belas (2010), banking system is determined by
factors that significantly affect the business of commercial banks such as the
credibility of the banking sector; money as the business object and atypical structure
of the balance sheet of commercial banks. These factors are a main reason for strict
regulation of the banking sector.
By using the CSR index, esk Spoitelna (CS) has the highest score in their CSR
management because this company has provided a lot of information that the
researcher can use as an ample fact or information such as their special document of
strategy for the period between 2011 to 2013, a very detailed report of their CSR
program on their website and some successful CSR program that has been reported by
the media plus the CEO of the company has been awarded several times as the best
banker of the year in nomination of Fincenteums Bank of the Year. As for
eskoslovensk Obchodn Banka (SOB), this company has the second highest in
terms of their CSR management because this company has a very well-planned CSR
strategy in terms of Policy of Sustainable Development and has a very good strategy
in terms of maintaining the relationship between their customers and the company by
using a standardised CSR measurement. Then, Komern Banka (KB) is one the best
in maintaining the human rights. This company has practiced the human rights in an
ethical way which means the management will always give a huge opportunity for
their employees to perform their task in a comfortable way and KB top-management
believes that human rights are apply to the customers too because everyone has their
own rights no matter they are investing a huge or small amount of money in the bank.
By practising human rights, it will be able to help the company to have a better twoway communication between their stakeholders and increase the positive impact
towards the company. Lastly, GE money bank has the lowest score in terms of CSR
management amongst three others because in terms of social policy, this company
does not have any governance that are set to protect or against the corruption which
means this company does not have any anti-corruption policies and procedures for
their employees to follow and this is one of the worst thing in this banking industry
because credibility is an important value for the company. Hence, there will be no any
customers that willing to put their financial risk under GE money bank as compares to

other competitors in the market. As a result, the negative impact towards this
company is relatively higher than the others.
Conclusion
In conclusion, Corporate Social Responsibility (CSR) has become extremely
important element in banking sector because moral principles are very important in
banking sector as it involve money transaction in the carry out the business.
In my opinion, the company can practice a strong CSR program by apply a suitable
marketing tools such as advertising through television media because by doing this, it
will helps the company to increase their positive impact towards the company image
and allow a way of communication between the company and their stakeholders. The
firm can show what kind of CSR program that have been done by the company. For
example, the commercial banks can donate some of the company profit to some NonProfit Organization in order to show others that the company cares about others and
the company itself did not focus on maximize their profit but use some of the profit to
help those who needed.