CSR Guidelines for the Financial Sector - page 8

4
1ChristianNoyer Governor of the Banque de France, as said by him in The history and future of corporate social responsibility”, (Thewelcome speech)
given in Symposium ICCA – EABH held on 27October 2008;
II
.Why theseGuidelines?
V
TheUnion of Arab Banks (UAB) hasmoved to form a special group of Arab experts in collaborationwith Schema (a
MENA specialisedCorporateGovernance (CG) andCorporate Social responsibility (CSR) firm) in order to develop
general CSRGuidelines for the financial sector in theMENA region. This initiative by theUAB comes as part of its
commitment to itsmembers and to the development of the Arab financial sector and the continuous improvement of
its standards and professionalism; having been a pioneer in recognising the fundamental role of CSR in promoting
sustainable, solid banking.
Banks play a fundamental role in the financial system as well as the country’s economy. Especially in the Arab region
where capital markets remain underdevelopedmaking it necessary for the banks to play a dominant part in the
financial sector, the payment system, and become themain source of funding and depository for savings.
Development and attraction of ForeignDirect Investment needs to includemore transparency and disclosure of
expenditure. The deregulation and liberalization of the banking sector requires the encouragement for an effective
CSR framework consistent with international standards and best practice, alignedwith the social and environmental
needs and awareness of the Arab region.
GoodCSR serves in ensuring sustainability. It increases stakeholder engagement and dialogue, improves the
relationshipwith the broader investment community providingmore access to capital, enhances employee relations,
and improves reputation and brandingwhile ensuring strong financial performance and profitability.
The effectiveness of a bank's CSR framework has a substantial effect on the ability of a bank to identify, monitor and
control its risks whilst identifying social opportunities in response to the needs of the community and stakeholders.
ImprovingCSR is seen as a significant way of encouraging banks to strengthen their capacity, tomanage and
identify such opportunities, encouraging the innovation and suitability of financial products for the needs of the
markets.When banks efficientlymobilize their resources, they lower their cost of capital and that of the firms and
households they lend to. Similarly, effectiveCSR by banks can generatemore value to the financial sector, local
markets and national economy, increasing the return on investments and subsequently improve the overall
operational and financial performance and their valuation.
In view of the above and in an attempt to undertake its role effectively, theUABwould like to prepareCSRGuidelines
for the financial sector in theMENA region. TheCSRGuidelines will be designed in away that will take account of
local needs and capacities, as well as the latest international trends and expectations, focusing on the practical
application of CSR principles for banks and financial institutions, and providing straightforward guidance on
implementation. TheCSRGuidelines aim to abide and comply with international standards, including Basel II
principles and the Equator Principles, whilst taking into consideration the particular characteristics of the region. A
one-day seminar in different countries will be held to engage bankers from the region for feedback and comments
that will be embedded in to theCSRGuidelines.
The financial sector is considered to be an indispensable part of our world – especially in developing countries;
financial institutions act as amedium for the transfer of resources from net savers to net borrowers and are amajor
source of long- term funds of the economy.
“CSR is a concept whereby financial institutions not only consider their profitability and growth, but also the interests
of society and the environment by taking responsibility for the impact of their activities on stakeholders, employees,
shareholders, customers, suppliers, and civil society represented byNGOs. Banksmust take on new responsibilities
that go beyond a simple policy of “paternalism” vis-à-vis their suppliers, customers and employees, such as that
practiced up until recent times”
4
1,2,3,4,5,6,7 9,10,11,12,13,14,15,16,17,18,...87
Powered by FlippingBook