Over the past few years, a rising emphasis was placed on banks' Corporate Social Responsibility (CSR). But what does CSR mean anyway? This is indeed one of the most frequently asked questions for all those dealing with its matters. A simple definition of CSR would be how banks take the impact of their operational activities on society into consideration. Consequently it requires a built-in, self-regulating mechanism whereby banks would monitor and ensure their adherence to law, ethical standards, and international norms to produce an overall positive impact on society. It is not surprising to see that CSR is subject to a considerable amount of debate and criticism. Advocates argue that banks benefit in many ways by operating with a perception broader and longer than their own immediate, short-term profits. Opponents argue that CSR diverts from the basic economic role of banks, others argue that it is nothing more than superficial window-dressing. Largely the banking industry does not realise the central importance of having a defined CSR policy. Many banks do not fully understand its worth, yet there are banks that do well in this area. There are obvious and real gains on hand for banks that have well-designed and successful CSR strategies; it would: * encourage sustainable behaviour by customers; * support development of separate business models for various segments; * provide real benefits for the society as a whole; * create higher employee motivation and superior performance levels; * make banks more aware of their potential role in society; * create positive publicity and/or increased brand recognition. Community involvement is the basis of all accomplished CSR policy initiatives and extends far beyond the standard charitable measures. Banks would normally introduce innovative CSR schemes such as: * permanent learning programmes for disadvantaged sectors of society; * sponsorship of young entrepreneurs; * provision of academic scholarships and research proposals; * support environmental issues such as recycling and waste management; * community support programmes; * health support programmes; * financial support for arts and culture. It is essential that there should be a transparent and strong commitment to adoption of CSR practices. This can be accomplished through explicit reference to CSR activities adopted by banks by dedicating sections of Annual Reports to CSR matters or by publishing Sustainability Reports and/or policy statements on CSR. It is important to note that corporate sustainability for banks is much more than mere charity. In this context, banks are encouraged to improve the future of the people in all communities they operate through CSR programmes, which in turn will sustain their business in the future. Just like other business sectors, the business of banking has a direct impact on the environment through consumption of paper, energy, waste management, and means of transport used. Direct environmental impact can be reduced by keeping environmental order in banks themselves by limiting the consumption of energy and paper, ensuring good waste management, and requiring suppliers' to conform to environmental standards. Banks can minimise the impact in a systematic manner by implementing environmental policy; it can even go further and apply for environmental certification in accordance with ISO 14001. The market in which banks operate today requires new range of products targeting new customer segments including groups who are not yet fully integrated in society and not dealing with banks such as low-income families and micro businesses operating in poor areas of the country. This situation represents for banks a challenge in terms of designing suitable products for these distinct segments but also an opportunity to develop a new type of business beneficial to all. Some good examples of responding to the challenge would be microfinance and financial education. Banks are encouraged to promote financial education projects involving different target groups. This can be achieved in two ways. First by concluding agreements with strategic partners that are recognised by the target groups to inform them better on financial services and products, which they will use in their daily day. Second is by developing contacts with the local authorities towards certain target groups. These target groups include primary schools, secondary schools, higher education, universities, and the general public world. To conclude this article in a local context, I would select an outstanding example of a bank that has several success stories in CSR arena. In recent years, Commercial International Bank (CIB) has demonstrated excellence in CSR initiatives. The bank has strong commitment to the community where their CSR strategies play a fundamental role in the bank's operations. CIB's approach to CSR addresses key areas such as sponsoring talent, community health, environmental awareness, and employee development. In 2010, the bank established CIB Foundation, a non-profit organisation dedicated to enhancing health and nutritional services for underprivileged children in Egypt. The foundation focuses on sustainable development initiatives that result in positive, long-term outcomes. The bank increased the percentage of its net annual profit to the Foundation to 1.5%. One hundred percent of the donations made to the account go towards the implementation of development projects for children. Hany Aboul Fotouh is a banking expert.
