Corporate Social Responsibility within Credit Institution in Romania
Corporate Social Responsibility (CSR) was long viewed as a costly or charitable measure on the short-run but now it is considered an asset worth having on the long-run. Credit institutions take on a significant role in the process of financial intermediation in the Romanian economy (a bank-based system). For this reason, CSR within these credit institutions is of great concern not only for the individuals but for the whole financial system (an important element to ensure financial stability and avoid systemic risk). In order to evaluate the level of involvement of Romanians’ credit institutions in CSR areas, this study used the content analysis method on the annual reports for a panel of five representative banks.
And what are the implications for the banks’ “ethical makeover”? Can conduct cost levels be reconciled with this? Some commentators have, for example, observed that it seems inappropriate to worry about the Co-operative Group potentially losing control over the Co-operative Bank, for fear it will not be able to hold on to its “ethical policies”, when that bank’s ethics are already under suspicion due to the scale (a £269M provision)of its product mis-selling. Do provisions like this reflect on ethics? It’s hard to argue that there is no relationship at all. But perhaps the conduct costs reflect the “bad old days” and, under new management, we can expect banks to improve?