CORPORATE SOCIAL RESPONSIBILITY ACTIVITY REPORT Kotak Mahindra Bank

Submitted By Kunal Sudhakar Patil PGDM Marketing (Div. C, Roll No.47) Under The Guidance Of Prof. Anahat Hulyalkar Associate Professor

INTRODUCTION

Kotak Mahindra Bank (BSE: 500247, NSE: KOTAKBANK) is an Indian financial service firm established in 1985. It was previously known as Kotak Mahindra Finance Limited, a non-banking financial company. In February 2003, Kotak Mahindra Finance Ltd, the group's flagship company was given the license to carry on banking business by the Reserve Bank of India (RBI). Kotak Mahindra Finance Ltd. is the first company in the Indian banking history to convert to a bank. Today it has more than 20,000 employees and Rs. 10,000 crore in revenue. Mr. Uday Kotak is Executive Vice Chairman & Managing Director of Kotak Mahindra Bank Ltd. In July 2011 Mr. C. Jayaram and Mr. Dipak Gupta, whole time directors of the Bank, were appointed the Joint Managing Directors of Kotak Mahindra Bank. Dr. Shankar Acharya is the chairman of board of Directors in the company. The Bank has its registered office at Nariman Bhavan, Nariman Point and Mumbai.

Type Traded as Industry Founded Headquarters Key people Products

Revenue Net income Website

Private BSE: 500247 & NSE: KOTAKBANK Financial service 1985 (as Kotak Mahindra Finance Ltd) Mumbai, India Uday Kotak (MD) Deposit accounts, Loans, Investment services, Business banking solutions, Treasury and Fixed income products etc. increaseINR10,963 crore (US$2.41 billion)(2011) increaseINR1,569 crore (US$345.18 million)(2011) www.kotak.com

Reach Kotak Mahindra Bank has over 329 branches and 782 ATMs, which are spread all over India, not just in the metros but in Tier II cities and rural India as well, we are redefining the reach and power of banking. Offerings in details

The company caters to the myriad needs of Resident Individuals, NRIs and Businesses. It offers complete financial solutions for infinite needs of all individual & non-individual customers depending on the customer's need - delivered through a state of the art technology platform. Investment products like Mutual Funds, Life Insurance, retailing of gold coins and bars etc are also offered. The Bank follows a mix of both open and closed architecture for distribution of the investment products. All this is backed by strong, in-house research on Mutual Funds. Their Savings Account goes beyond the traditional role of savings, and allows you to put aside a lot more than just money. The worry-free features of Their Savings Account provides a range of services from funds transfer, bill payments, 2-way sweep through Their Activ Money feature & much more. You can place standing instructions for investment options that can be booked through Internet or through Phone banking services. The Savings Account thus provides for attractive returns earned through a comprehensive suite products and services that offer investment options, all delivered seamlessly to the customer by well integrated technology platforms. Apart from Phone banking and Internet banking, the Bank offers convenient banking facility through Mobile banking, SMS services, Netc@rd, Home banking and Bill Pay facility among others. The Depository services offered by the Bank allows the customers to hold equity shares, government securities, bonds and other securities in electronic or Demat forms. Their Salary 2 Wealth offering provides comprehensive administrative solutions for Corporate with features such as easy and automated web based salary upload process thereby eliminating the paper work involved in the process, a dedicated relationship manager to service the corporate account, customized promotions and tie - ups and many such unique features. The whole gamut of investment products and investment advisory services is available to the salary account holders as well. For the business community, we offer comprehensive business solutions that include the Current Account, Trade Services, Cash Management Service and Credit Facilities, keeping in mind the myriad needs of your business.. Our Wholesale banking products offer business banking solutions for long-term investments and working capital needs, advice on mergers and acquisitions and equipment financing. To meet special needs of the rural market, we have dedicated business offerings for agricultural financing and infrastructure. Our Agriculture Finance division delivers

customized products for capital financing and equipment financing needs of our rural customers. For financial liquidity we offer you loans that meet your personal requirements with quick approval and flexible payment options. To complete the personal financial offerings space, we now offer Kotak Credit Card which is a hassle-free, transparent product that also happens to be the first vertical credit card in the industry. Kotak Mahindra Bank addresses the entire spectrum of financial needs of Non-Resident Indians. Our tie-up with the Overseas Indian Facilitation Centre (OIFC) as a strategic partner gives us a platform to share our comprehensive range of banking & investment products and services for Non Resident Indians (NRIs) and Persons of Indian Origin (PIOs). Our Online Account Opening facility and Live Chat service helps you to get in touch with us at the comfort of your homes and at your convenience. These offerings are specifically designed to suit the overseas Indian's personal financial needs and give the global Indians a near to home feel. Vision for Corporate Responsibility Kotak Mahindra views Corporate Social Responsibility as an investment in society and in its own future. Kotak uses the power of its human and financial capital to help in transforming communities into vibrant, desirable places for people to live. The group leverages its core competencies in three areas:
y

Sustainability An integral part of all Kotak Mahindra Group activities is to be consistently responsible to shareholders, clients, employees, society and the environment. Economic Development By helping people achieve their financial goals, Kotak strengthens the fabric of communities and helps them overcome unemployment and poverty to help them shape their future. Doing My Bit A growing number of employees are committed to civic leadership and responsibility with the support and encouragement of the Kotak Group. A number of employees have been involved in strengthening communities through voluntary work, payroll giving and management inputs.

TIMELINE OF SUCCESS

Year

Milestone Kotak Mahindra Bank Ltd entered into a Business Cooperation arrangement with CIMB Group Sdn Bhd, Malaysia.

2011

Ahmedabad Derivatives and Commodities Exchange, a Kotak 2010 anchored enterprise, became operational as a national commodity exchange. 2009 Kotak Mahindra Bank Ltd. Opened a representative office in Dubai 2008 Launched a Pension Fund under the New Pension System Bought the 25% stake held by Goldman Sachs in Kotak Mahindra Capital Company and Securities

2006

Kotak Group realigns joint venture in Ford Credit; Buys Kotak 2005 Mahindra Prime (formerly known as Kotak Mahindra Primus Limited) and sells Ford credit Mahindra. 2005 Launches a real estate fund 2004 Launches India Growth Fund, a private equity fund. Kotak Mahindra Finance Ltd. converts to a commercial bank - the first Indian company to do so.

2003

2001 Matrix sold to Friday Corporation 2001 Launches Insurance Services

2000

Kotak Mahindra ties up with Old Mutual plc. for the Life Insurance business.

Kotak Securities launches its on-line broking site (now www.kotaksecurities.com). Commencement of private equity 2000 activity through setting up of Kotak Mahindra Venture Capital Fund. Enters the mutual fund market with the launch of Kotak Mahindra Asset Management Company.

1998

The Auto Finance Business is hived off into a separate company Kotak Mahindra Prime Limited (formerly known as Kotak Mahindra Primus Limited). Kotak Mahindra takes a significant stake in Ford 1996 Credit Kotak Mahindra Limited, for financing Ford vehicles. The launch of Matrix Information Services Limited marks the Group's entry into information distribution. Brokerage and Distribution businesses incorporated into a separate company - Kotak Securities. Investment Banking division 1995 incorporated into a separate company - Kotak Mahindra Capital Company 1992 Enters the Funds Syndication sector The Investment Banking Division is started. Takes over FICOM, one of India's largest financial retail marketing networks

1991

1990 The Auto Finance division is started Kotak Mahindra Finance Limited enters the Lease and Hire Purchase market Kotak Mahindra Discounting Finance Limited starts the activity of Bill

1987

1986

Corporate social responsibility

Corporate social responsibility (CSR, also called corporate conscience, corporate citizenship, social performance, or sustainable responsible business/ Responsible Business) is a form of corporate self-regulation integrated into a business model. CSR policy functions as a built-in, selfregulating mechanism whereby a business monitors and ensures its active compliance with the spirit of the law, ethical standards, and international norms. The goal of CSR is to embrace responsibility for the company's actions and encourage a positive impact through its activities on the environment, consumers, employees, communities, stakeholders and all other members of the public sphere who may also be considered as stakeholders. The term "corporate social responsibility" came into common use in the late 1960s and early 1970s after many multinational corporations formed the term stakeholder, meaning those on whom an organization's activities have an impact. It was used to describe corporate owners beyond shareholders as a result of an influential book by R. Edward Freeman, Strategic management: a stakeholder approach in 1984. Proponents argue that corporations make more long term profits by operating with a perspective, while critics argue that CSR distracts from the economic role of businesses. Others argue CSR is merely window-dressing, or an attempt to pre-empt the role of governments as a watchdog over powerful multinational corporations. CSR is titled to aid an organization's mission as well as a guide to what the company stands for and will uphold to its consumers. Development business ethics is one of the forms of applied ethics that examines ethical principles and moral or ethical problems that can arise in a business environment. ISO 26000 is the recognized international standard for CSR. Public sector organizations (the United Nations for example) adhere to the triple bottom line (TBL). It is widely accepted that CSR adheres to similar principles but with no formal act of legislation. The UN has developed the Principles for Responsible Investment as guidelines for investing entities.

In context to India, the studies for rating CSR activities of Indian corporate are very few. Singh and Ahuja26 (1983) conducted the first study in India on CSR of 40 Indian public sector companies. In 2006, Raman27conducted a study using content analysis technique to identify the extent and nature of social reporting. However, it is important to mention that in spite of mass acceptance to the concept of CSR reporting by banking sector around the globe, Indian banks are not responding in the expected manner. According to some critics, Indian financial

institutions are concerned to the exclusion of all other considerations about the ecology of their balance-sheets and, therefore, focused on ever-greening their assets. Rating of CSR activities of Indian banking sector has been done by Karmayog in recent years. Indian commercial banks and reported that two third of surveyed 36 banks couldn't even secure level 3 at 0-5 scale, no bank could touch level 5 and just one bank could attain level 5. The summary of Karmayog's28CSR ratings of these banks in 2009 could be shown by table:

CSR rating of Indian commercial banks No. of Banks Name of Banks Level 0 3 City Union Bank, Karur Vysya Bank, Vijay Bank Central Bank of India, Indusind Bank, Karnataka Bank, Kotak Mahindra Bank, South Indian Bank and UCO Bank

Level 1

BEYOND BUSINESS

Towards building a better community

In the wake of the recent financial sectors. In these times of unease and uncertainty, the relevance of Corporate Social Responsibility is probably greater than ever, people at Kotak see it as an opportunity to participate and drive the dialogue for sustainable development, based on lasting relationships with stakeholders.

Kotak believes that the environmental and social responsibility efforts begin at home and hence, we continue to participate in and support environmental and socially responsible initiatives.

Conservation

The annual report is printed on 100% recycled paper which is chlorine free and environmentally friendly. We strive to reduce the consumption of water, electricity, fossil fuels and paper in our day to day operations. Towards this ideal, we have organized the following:

The R-Five Program: It aims at recycling and improving energy efficiency.

No Car Day: We rallied together to observe this day to promote fuel conservation, especially to the fossil fuels.

Earth Hour: Kotak employees actively participated in the 'Earth Hour' to support energy conservation.

Nature Trail: 125 Kotak employees in Mumbai gathered together to support a Nature Trail organized by BNHS.

Community Building and Volunteering

Kotak participates in a number of initiatives that support society at large. Our programmers emphasize health and cooperation through working with nonprofit organizations and often involve our employees on a voluntary basis.

We have dedicated special attention to communities or groups at risk of financial exclusion, through our support to 'Svasti Foundation' in Mumbai which works in the field of Microfinance. During the year, 'Svasti' opened two branches and helped over 4,000 beneficiaries.

Healthcare

Kotak undertook the following initiatives in order to raise awareness and serve our community better.

Kotak continued our Blood Donation activities that we began last year through our voluntary blood donation program. A blood donation drive was conducted on the occasion of Republic Day in 8 cities this year and donors helped collect 835 units, which in effect could save 2,505 lives. Voluntary organizations live Red Cross Blood Bank were our partners in this drive. With the help of '1098 Ambulance for All' and 'Life Supporters Institute of Health Sciences', we arranged for training program for our staff in first aid and basic life support. Today we have more than 100 trained staff members who can offer basic life support and first aid to citizens.

The other campaign that we championed this year include the 'Eye

Donation' and 'World Sight Day', which involved raising awareness and increasing eye donation pledges.

Kotak extended our support to 'Cancer Patients Aid Association (CPAA)'. To raise funds for CPAA and to spread awareness about the disease, around 60 Kotak employees participated in the Mumbai Marathon. Through the marathon, we helped rise over Rs 9 lakh for the social sector.

Education

Kotak collaborated with organizations like 'Goonj' and 'Vidya' to support the cause of education. Our employee volunteered time and also donated school books and stationery for underprivileged school children through 'Goonj'. These initiatives helped over 1,000 beneficiaries in different cities.

Social Awareness

Kotak extended our support to the 'Jaago Re' campaign which aimed at registering the eligible employees and their families as voters. Such campaigns not only help in exercising the right of the people to elect the Government of their choice, but they also ensure that people are aware of their responsibilities as a citizen to register, vote and help protect democracy.

The Way Ahead

Kotak is in the service industry. Peculiar to this industry is the belief that we can impact those around us by first impacting our own mindsets and attitudes. Our philosophy on Corporate Social Responsibility is built around this belief. Thus, you would notice that a majority of the initiatives are designed to impact the maximum number of our employees and their

families. Through our actions and attitudes we hope to make a positive difference to the world we live in. Initiatives like reducing wastage not only make good economics but also good social responsibility. Similarly, a culture of care and concern ensures the long term viability of our business. We believe that thius route of incorporating responsibility in our daily professional life will pay handsome dividends in the future for business, for the shareholders and for the community at large.

Snapshots of our CSR initiatives

Jun 17, 2009 - Initiated the 'Employee Volunteering Program' with Kotak Education Foundation, wherein 65 employees volunteered and taught children Mathematics and English on weekends.

Jun 23, 2009 - Observed 'No Printing Day' across the Kotak group to promote conservation in our daily operations.

Aug 9, 2009 - A Nature Trail was organised for the employees to sensitize them about our eco-system. 125 participating employees and children were given tree sapplings.

Sept 5-13, 2009 - Goonj - DHL's 'Deliver Help Drive' campaign which was aimed at recycling and collection of reuseable goods, was supported during this week.

Sept 22, 2009 - 'Employee Giving' survey was conducted across the group, to enable the employees in channelizing their efforts to support social causes through employee giving.

Oct 9, 2009 - Employee Volunteering opportunity was initiated along with a South Mumbai based NGO in the education sector. Employees and their family members taught in municipal schools as a part of this

initiative.

Oct 14, 2009 - Diwali gift stalls were organised in association with various NGOs at our office in Kalina and Goregaon.

Oct 15, 2009 - 'World White Cane Day' promotional mailers supporting Eye Donation drive were sent out, followed by the promotion of the concept of the 'Eye Donation Pledge' at our offices in Mumbai.

Nov 10, 2009 - R-5 Initiative that had been implemented by the bank was launched across the Kotak Group.

Dec 14-22, 2009 - National Association for the Blind (NAB), Akanksha and Make-a-Wish Foundation organised gift stalls at Kotak Bank branches for promotion and sale of their goods to our customers.

Dec 18, 2009 - Kotak 'No Car Day' was observed to support the fuel conservation efforts.

Dec 21, 2009 - Christmas gift stalls were organised by Make-a-Wish Foundation, Vidya and NAB at at our office in Kalina and Goregaon.

Jan 17, 2010 - Over 60 employees of Kotak group participated in the Mumbai Marathon 2010, to support the Cancer Patients Aid Association.

Jan 22 - 29, 2010 - A 'Blood Donation' drive was organised in 8 centres across India on the occassion of Republic Day collecting 835units, which would help save 2000 lives.

March 27, 2010 - WWF 'Earth Hour' campaign was promoted within the employees as a part of our efforts towards energy conservation.

CONCLUSION

REFERENCES

http://en.wikipedia.org/wiki/Kotak_Mahindra_Bank

http://en.wikipedia.org/wiki/Corporate_social_responsibility

http://www.kotak.com/bank/aboutus/default.htm#top

http://aboutus.kotak.com/corporate-responsibility.html

Nishi Sharma - (IJAEBM) INTERNATIONAL JOURNAL OF ADVANCED ECONOMICS AND BUSINESS MANAGEMENT Vol No. 1, Issue No. 2, 058 066 http://www.karmayog.org/csr2010/csrall/csrdetails.aspx?id=26