Corporate Social Responsibility at HSBC Bank
Corporate social responsibility is an important regulatory aspect that has been continuously employed by businesses to ensure that their activities are in line with the legal, ethical and environmental expectations of the community within which they are located. Effective functioning of an organization is usually influenced by a host of factors that characterize both its internal and external environment. Corporate social responsibility constitutes an obligation that all businesses have on the society. Its goals seek not only to encourage active involvement of stakeholders and shareholders in management, but they also eliminate practices that are likely to undermine its performance in the corporate sphere. Essentially, public interest is given preference in corporate decision making to enhance sustainable development. It is against this background that this paper reviews the role of HSBC bank in social corporate responsibility. It also underscores a specific strategic thing that the organization did and the implications it had on the community as well as HSBC.
HSBC is an international bank that has close to seventy six branches across the globe. It has a large clientele and offers a wide range of activities to the society. In order to maintain optimal growth, it partners with different organizations and individuals at all levels. Its corporate social responsibility services are all inclusive and factor in the needs and interests of the environment, community and its stakeholders. This has enabled it not only to attain its business goals but also to have public approval. This can be used to explain why the bank has prospered over time.
With regard to the environment, the organization believes that climate change is an actual phenomenon that can have far reaching implications on human survival. It is for this reason that HSBC (2006) cites that the need to incorporate the concept of sustainable development in its activities was imperative. This was done in light of the basic definition that postulates that sustainable development should not only satisfy the needs of present populations but should also be in position to safeguard those of future populations.
The organization has established a professional and fully operational team that addresses issues pertaining to environment and sustainability. In particular, it is charged with the responsibility of formulating as well as implementing an EMS (Environmental Management System) that is imperative for managing the environmental impacts that accrue from the organization’s activities. In addition, EMS is also elemental in identifying specific areas that require improvement. This is attained through frequent assessments, measurement and monitoring.
HSBC has attained significant results with respect to environmental management, protection and sustainable development. In particular, HSBC (2010) notes that here are credible systems in place that have enhanced environmental reporting. This covers different areas that range from waste production, water consumption, carbon dioxide emissions to energy consumption. Recent reports in this regard indicate that the organization managed to reduce waste production, energy consumption and water consumption. Of great importance is the fact that it is working towards adopting the vital principles of ISO14001.
Specific approaches that have been instrumental in helping the organization to attain these goals include e-procurement that reduces the costs related to purchasing the relative implications on the environment. Essentially, it has ensured that all transactions in all areas are carried out electronically. The employment of green electricity in the United States has been a major step in enhancing sustainability by curbing the level of pollution. With respect to use of paper, the organization acknowledges the fact that it uses significant quantities of this.
However, it has put strategic measures in place to reduce the quantities employed by recycling. Further, the vehicles employed in running operations are hybrid and environmentally friendly. Of great importance according to HSBC (2010) has been the partnering with other environmental organizations such as Erath watch Institute and The environmental group to protect watershed areas and biodiversity as well as carry out relative research aimed at attaining similar goals.
Ravichi (2010) ascertains that HSBC also supports the communities within which it is located through donations and enhancing the involvement of employees in community activities and voluntary work. Furthermore, it liaises with other organizations to support a wide range of local efforts on a global scale. To begin with, donations made to the community are sourced from staff and customers in different countries. This is done through cash machines, e-banking and through the telephone. Perhaps the most important contribution that has benefited the community in the recent past has been the education program. Efforts in this respect are concentrated on financing education, helping the disadvantaged children, making diverse contributions to primary as well as secondary education, teaching local languages and initiating projects that seek to enhance international understanding. These projects lay emphasis on active involvement of employees.
The most important project form the above has been financing education. This has been carried out under the Financial Literacy program and has currently been running for the past three years (HSBC, 2006). A total of twenty seven countries have benefited from this goal of enhancing literacy to the population between 26 and 25 age cohorts. Another group of individuals that have equally benefited significantly from this project are the women entrepreneurs.
The organization funds the relative programs that are implemented with the help of Student in Free Enterprise (SIFE) organization across the globe. Notably, these programs are sustainable and of great value to the communities. Students form deprived areas in primary and secondary learning institutions benefit immensely from these programs. This is undertaken under the department of philanthropic services within the organization. Also, it partners with Junior Achievement, a renowned nonprofit organization that seeks to educate young people and provide value in areas of business economics and free enterprise.
With respect to enhancing literacy among the adults, the organization collaborates with The Center for Neighborhood Enterprise (CNE) to deliver workshops that enhance adult literacy. In particular, The Center for Management Research (2005) indicates that the organization provides funding that is imperative for the development of a viable curriculum. The main area of concern of this project is to assist the consumers in different aspects of credit. Furthermore, it imparts vital skills that pertain to home ownership.
Also worth mentioning is the role of the organization in nurturing the talents of young people. In this respect, HSBC (2006) ascertains that the organization identifies young people with exemplary talents in different countries and provides them with financial support. The respective students are given scholarships and to fund for their tuition fees in colleges; both at home and abroad. For instance, it is indicated that the Hong Kong Bank foundation reserved a significant US$900000 to go towards bursaries, scholarships and a wide range of development programs (HSBC, 2006).
The program is also active in Malaysia and thirty seven universities in this have had their scholarship programs funded by the bank. Notably, the education program has been instrumental in enhancing the literacy levels of different persons across the globe. The bank has in return benefited by not only attaining public approval through awards and accreditation but also by exposing its employees to different work environments and enhancing awareness about different issues. Most importantly, they have ensured that their moral standards are within the expectations of the society. It is certain that this is fundamental for effective functioning and sustainable development.
Another area of corporate social responsibility that the bank has had an exemplary performance is stakeholder engagement. The inherent interaction provides the organization with credible knowledge with respect to the expectations of business associates. It also enhances transparency and helps to boost trust that is fundamental for this area of business. Objective feedback from these stakeholders also provides the organization with fresh and useful insights that are essential for organizational success (HSBC, 2006).
Customers are the first group of stakeholders that contribute significantly to the success of these organizations. HSBC has improved and maintained viable customer relations by ensuring a quick response to their demands. Regular monitoring and research derives important information from the customers that are then incorporated in decision making. Specific customer concerns about personal money management, identity theft, savings and credit are employed in aligning education programs to the needs of the customers. The relative practical measures that address the concerns in a sustainable manner include development of education programs and dissemination of vital information about the respective issues.
The employees of this organization are also an important asset and engaging them in management has been accorded utmost attention by the bank. In this regard, HSBC (2006) cites that employees are trained and allowed to participate in different voluntary programs at the community level. In particular, they are involved in development of education curriculums with which they carry out workshops in communities. This has significant benefits to the organization as it diversifies the skills of the employees and enhances their performance. Employees are encouraged to complete employee surveys after every 12-18 months.
These evaluate different issues that affect the employees such as job satisfaction, employee intention to stay at the organization and their capacity to make references to other individuals about the bank. The results of these are then employed in developing important regional plans and benchmarks of decision making. Further, there are employee unions that are imperative in addressing different concerns of the employees. These have enabled the organization to develop viable ways of adapting to the dynamic environment. It also enhances understanding that enables the organization to address the emergent employee needs with ease.
With respect to the needs of the investors, Gitshami (2005) ascertains that the organization has close to 200,000 registered shareholders that have diverse needs and interests. These encompass insurance companies, mutual funds and pension funds that provide the bank with a very large client base that is interested in the services that they provide. The organization has enhanced their participation in management by improving information flow and communication with them. The characteristic direct dialogue during meetings has been instrumental in promoting trust. This has improved the number of investors in the recent past (HSBC, 2010). The organization also partners with the government in ensuring that it maintains a legal standing in its operations. It has refrained from funding political activities over time but instead participated actively in advocating for policy positions that enhance public welfare.
Finally, the bank liaises with different nonprofit oriented organizations in attainment of sustainable development. This relationship enables it to maintain a high degree of transparency in its operations. In particular, the Nongovernmental organizations investigate the operations of the organization to ensure that they are in line with the legal and ethical expectations of the society. Frequent consultations and reviews have been imperative in keeping the bank in check and enhancing its effectiveness and credibility. Of great importance has been the ability of the bank to emphasize on the impacts of their products and tailor the same to meet the desires and interests of the consumers.
Corporate social responsibility is an important aspect of organizational management and regulation. It enables the organization to address the emergent and complex needs of the society without compromising its ability to meet its goals. Most importantly, it enables the organization to maintain a good moral standing that enhances public approval. The diverse benefits accruing from this also entail improvement of employee performance and overall productivity of the organization.
HSBC is an international bank that has gained prominence over time and expanded to international levels. This is attributed not only to the basic factors of production but also to its active participation in corporate social responsibility. Its emphasis on the environment, community and stakeholders has enabled it to address holistic interests of the community in a sustainable manner. From this, it has derived different benefits that continue to boost its performance. At this point, it can be concluded that its exemplary performance in the corporate sphere is contributed to by its social corporate responsibility.
List of Reference
Center for Management Research, 2005, Corporate Social Initiatives at HSBC, Making Good Business Sense, Retrieved 16th May, 2010 from, HYPERLINK “http://www.icmrindia.org/casestudies/catalogue/Business%20Ethics/CSR%20Initiatives%20at%20HSBC%20-%20Making%20Good%20Business%20Sense.htm” http://www.icmrindia.org/casestudies/catalogue/Business%20Ethics/CSR%20Initiatives%20at%20HSBC%20-%20Making%20Good%20Business%20Sense.htm
Gitshami M, 2005, An Assessment of HSBC Corporate Social Responsibility Report, 2004, Retrieved, 16th May, 2010 , from: HYPERLINK “http://www.ethicalcorp.com/content.asp?ContentID=3881” http://www.ethicalcorp.com/content.asp?ContentID=3881
HSBC, 2006, HSBC Corporate Social responsibility Report, 2005, Retrieved, 16th May, 2010 from, HYPERLINK “http://www.hsbc.com/1/PA_1_1_S5/content/assets/csr/hsbc_csr_report_2005.pdf” http://www.hsbc.com/1/PA_1_1_S5/content/assets/csr/hsbc_csr_report_2005.pdf
HSBC, 2010, Corporate Responsibility, Retrieved 16th , May 2010, from, HYPERLINK “http://www.hsbcusa.com/corporateresponsibility” http://www.hsbcusa.com/corporateresponsibility
Ravichi M, 2010, CSR in Banking, HSBC Steps Beyond the Equator Principles, Retrieved, 16th, May, 2010 from, HYPERLINK “http://www.justmeans.com/CSR-in-Banking-HSBC-Steps-Beyond-Equator-Principles/14735.html” http://www.justmeans.com/CSR-in-Banking-HSBC-Steps-Beyond-Equator-Principles/14735.html