We welcome the Bangladesh Bank governor’s call for the boards of banks and financial institutions to avoid financing ventures which harm the environment.
The central bank has been the driving force behind a large increase in CSR and green banking activity by Bangladeshi banks over the last five years.
It is commendable that it is asking banks and financial institutions to put more focus on their corporate social responsibility policies upon encouraging social and environmental investments, rather than just seeing CSR as primarily about charity-based activities.
Donations to community, Education and health activities are commendable in their own right and should be encouraged by tax incentives. They are especially worthwhile when they encourage leading companies to volunteer staff time and share expertise.
However, the real benefits of CSR are gained when it is integrated into a company’s core activities. Reputation and human capital are increasingly the most important assets of a business. By helping to attract and retain staff, CSR policies can help attract consumers and capital and build long-term value.
It is encouraging to see the Bangladesh Bank increase reporting on how banks integrate CSR within their operations and among their customers.
If more financial institutions disclose figures in their own annual reports on such topics as their environmental emissions and gender diversity policies, this will encourage more companies in other sectors to do likewise.
Corporate transparency on their social and environmental impacts is a proven way to help consumers and companies drive improvements and should be encouraged.
Source: UNBconnect
