Standard Chartered's Corporate Social Responsibility

This assignment examines Standard Chartered Bank's approach to corporate social responsibility (CSR). It analyzes various aspects of their CSR strategy, including their policy, sustainability initiatives, and impact on different stakeholders. The analysis draws upon provided resources such as the bank's official website and external research papers that delve into the relationship between corporate governance, CSR, and organizational attractiveness.

Contemporary Developments
in Business and Management

Table of Contents
INTRODUCTION...........................................................................................................................1
TASK 1............................................................................................................................................1
Political Influence.......................................................................................................................1
Economical influences................................................................................................................2
Social...........................................................................................................................................3
Technological..............................................................................................................................3
Legal influence............................................................................................................................4
Environmental.............................................................................................................................4
TASK 2 ...........................................................................................................................................4
i) Relevance of ethics and CSR to Standard Chartered bank and their impact on policies and
decision making process.............................................................................................................4
ii) Effectiveness of organisational response................................................................................8
(iii) Areas of improvement as a response..................................................................................10
CONCLUSION..............................................................................................................................12
REFERENCES..............................................................................................................................13

INTRODUCTION
There are certain changes which are taking place rapidly within business organisation and
different issues are being faced by multinational companies while conducting their operations in
an effective manner. But along with that they are seeking out for platform of opportunities which
can be exploited by making effective strategies and implementing them (Abuznaid, 2017). In this
report, company chosen is Standard Chartered bank who is mainly dealing in banking and
financial service industry. This bank was established by James Wilson in 1853 and it is mainly
dealing in Australia, China and India. There are certain things which will be discussed in this
report like external factors which will directly affect the working environment of Standard
Chartered. Moreover, essential elements which are related to external factors will also be
discussed. The theme of this project is Ethics and CSR activities. Another essential element of
this kind of assignment will be the response which is given by an organisation where the issues
are being faced which are related to ethics.
TASK 1
Standard Chartered is one of the leading bank in financial and insurance sector. At their
initial stages, this business has limited reach and they were not present in many nations. There
business expanded when the under developed and developing countries started accepting the
foreign investment and thus due to that many multinational companies got opportunities to
acquire the market and thus attain profit for the long terms effect (Orlitzky, Siegel and Waldman,
2011). Most of the internal issues can be resolved by an enterprise which are raised within
workplace but there is no control on various external factors which can create either positive or
negative impacts on the performance level of an organisation. Below described are the elements
and their importance are mentioned below:
Political Influence
In many continents, Standard Chartered is providing their services and this has to be
make sure that money which is being invested in a country should have better political stability.
There is major issue, like in India Govt. changes with time and thus due to that variations can be
seen in the policies which are related to banking sector like increment in bank rate, procedure of
taking loan and many more (Banerjee, 2012). There are various changes which a company like
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Standard Chartered has to adopt and thus make proper modifications so that they can cope up
within marketplace due to uncertainty in politics.
Example of political influence Effect on company
Military action Damage to property of corporation
Hard regulations against foreign institutions Diminution in sales
Violence and side-splitter in country Barriers in supplying better services to
consumers.
Importance
It is highly essential for an organisation like Standard Chartered as they need to set their
focus on business expansion in an nation which does not have major issues which are related to
political stability so that aims and objectives can be attained in positive and effective manner. It
becomes highly difficult for a company to operate their business in country where there is no
stability in political power and this in turn will does not make long term strategies for completing
goals.
Economical influences
It is highly beneficial for a company specially for a multinational companies like
Standard Chartered to attain growth and success. In an economy, if the aggregate demand does
not raises then it will definitely impact the conduction of operations which are being operated in
the respective territory (Bean, 2012). There are various incidents like economic crisis which can
impact the banking sector in negative manner.
Importance
In an economy, running the business which is still growing at fast pace in more then 8%
assist an enterprise in earning more profit. High revenue is being earned by Standard Chartered
when they enter into China and India but the growth rate declined due to global economic crisis.
This can be said the most important cause of declining in market place along with it shares value
and thus they due to that many customers were lost. If the business is being expanded in
developed economy then more revenue and goodwill can be obtained by company and thus more
will the cash flow within an economy (Sharma, Sharma and Devi, 2011). This all will lead to
attract customers even for expensive services which are being provided by Standard Chartered.
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This bank is highly known for giving better services and along with that it also contribute in
national income and that will be done by acquiring large number of customers and their
purchasing power.
Social
There are some norms which has to be followed by every organisation which are
operating in an economy. Laundering the money can be stated as one of the social issue which
are being faced by Standard Chartered and thus it can impact the performance and goodwill level
(Crane and Matten, 2016). In Africa and Asia, people used to save the money in their own places
but in current situation, perception has been changed and people prefer to save their money in
banks.
Importance
Various cases which are being related to money laundering is an essential element for the
company as it affects the image within society and trust of people who are attached with banks.
In a developed nation, people understand the concept of saving their money into banks instead of
their own house so that money can be flown within society so that economic development can
take place. Trend has been completely changed within three to four decades within developing
nations and now people just not save their money but also invest into banks for profit. More
people are connected with Standard Chartered due to their services which are being provided
along with interest rate. Modification in trends is an essential factor in the success of this bank
especially in Asia-Pacific reason.
Technological
This can be stated as essential factor which has direct impact on the performance level of
an organisation. Changes are being bought through applying various tools and techniques.
Tension is being created within bank due to unethical hacking and occurring of various types of
Viruses (Freeman and Hasnaoui, 2011). By swift changes, influences can be observed which is
being occurring in banking sector due to up-gradation of technology in rapid manner.
Importance
If the new techniques are not being adopted by a company, then there are various
facilities which they would not be able to avail like online transfer of money, bills payment
through mobile phones and many others. Standard Chartered realise that these kind of
technological factors is highly essential for them and thus due to that attraction factor can be
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upgraded. Significance of external factors are high in nature and due to that they are able to
obtain success in marketplace.
Legal influence
Modifications are being done by European union and thus due to that regulations are
getting tuff. There are various sound customers norms of protection and most of the Govt. where
Standard Chartered bank is being operated. All the acts needs to be followed in order to follow
themselves from legal issues (Crane, Matten and Spence, 2013).
Importance
It is highly essential for Standard Chartered bank to follow the rules and guidelines. All
the regulations have been included and it has been helping and guiding them in effectual manner
so that millions of money can be saved which can vanish as expenses. They have effective and
high goodwill and they are focusing on maintaining so that illegal activities can be avoided.
Legal compliance is expensive in nature and thus it consumes lot of time of top level
management as they are responsible for making and controlling policies of company.
Environmental
There are various environmental issues which are being faced like climate change,
recycling of waste which can direct impact the process of company. Standard Chartered is also
committed for reducing the wastage of paper and other materials. These steps are being taken
due to influence power of change in environment (Gitsham, 2012).
Importance
Clearing up the atmosphere is an effective and necessary step which needs to be taken by
every individual and every organisation so that environment can be kept pollution free. Paper
wastage is another step which needs to be taken so that more trees can be saved and recycle
process of wastage can be much more effective in fulfilling the various Govt. regulations and
image within the society can be enhanced.
TASK 2
Ethics and Corporate social responsibility
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i) Relevance of ethics and CSR to Standard Chartered bank and their impact on policies and
decision making process
Confusion is being created within people by the help of two terms. One can be said as
legal and other can be said as illegal. Legal is obviously related to law which is present in a
territory. Regulations are being followed by all organisations and if that is not being adopted then
there are high chances that they have to deal with legal obligations. There is moral standards and
among them is ethics which may be not similar for each and every company but it provides equal
importance and benefits to company (Corporate Social Responsibility Policy. 2017). It provides
on the basis of ethical grounds as presence is not there within law. In banking sector, gaining the
trust and satisfaction of customer is highly essential and thus for attainment of goals is done
through ethics (Groves and LaRocca, 2011). There are various areas which are being covered in
regard of ethics and its impact on decision making and policies of Standard Chartered bank:
Transparency: This can be stated as essential element of Ethics. Faith is being reduced
from banks if the perception is set that bank is hiding something regarding policies or working
style within mind of customers. This mindset can hamper the productivity of bank so it is highly
essential for bank to maintain the transparency and states up actual facts while providing
services. This will uplift the trust level of company and more customers will join and best
services for which the bank is known for can be given. Maintaining high level of transparency
will reduce the profit ratios as more money which is covered by keeping customer in dark will be
vanished. This kind of issues can be resolved through taking face to face with customers and
stating them the facts which can be availed by them by paying the bank. Manager of the
company changes their decisions so that policies can be maintained which are related to
transparent operations.
Promotion of fair trade practice: Standard Chartered bank is present across the globe.
This bank majorly promote the fair practices like customers who like to have legal services but
they does not encourage the people who comes to convert their black money into white or for
money laundering (Hopkins, 2011). This kind of practice is highly followed by them as in other
countries they are facing the issues which and sometimes it involves court cases as well. Bank
cannot upset their customers by denying them for providing help or by asking them to disclose
origin of money and at the same time they need to ensure that they do not do any unethical
practice. Ethical code is being followed by Standard Chartered and their policies are being
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influenced regarding the services which they provide. Discouraging the issue of money
laundering needs to be done by every company dealing in banking sector and cited bank has
implemented it.
Diversity issue: Standard Chartered focuses on providing equality to all the workers
who are working within workplace. There are many employees who comes from different places
and follow different cultures and company understand their needs and tries to fulfil it. It is ethical
to give equality to every kind of employee and thus cited organisation has done some
modifications in policies relating to HR for improving diversity (Hopkins, 2012).
Although Standard Chartered is known for providing effective service along with better return
and unethical activities which they have faced in past few years:
 Money Laundering: There are various issues which are being faced by company
regarding to money laundering. Company was found guilty and thus they were fined with
amount of 1.92 billion dollars. This happened once and goodwill of company was highly
affected in negative manner. Abusive Mortgage Practices: Due to many issues, many of the people have faced
financial issues. They were fined with unethical practice as there were rules made for
poor and rick clients separately.
Relevance of CSR to Standard Chartered and its influence on organisation
Open banks in Rural Areas: This kind of approach is highly utilised while serving to rich
and prestige customers as they have more contribution in their profit. They even understood that
they have social responsibilities which needs to be fulfilled as they are operating among them
only so they decided to open their branch in other state of India. Required modifications were
done in policies and money was spend on opening up of branches at location which has not much
scope of giving profit. This was highly unethical by terminating those employees who were
totally dependent on given salaries by the bank and the main reason for termination of those
employees was to reduce the cost of business (STANDARD CHARTERED SUSTAINABILITY
HOMEPAGE. 2017). Better response was expected from this kind of organisation by financial
analysts like paying high dividend
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(Source: STANDARD CHARTERED SUSTAINABILITY HOMEPAGE)
Promoting Education: This organisation is earning in billions of dollars and due to that
they are providing social services to the children by giving them education so that they can have
better future. Apart from that vocational training is provided so that employment can be raised.
Besides this they have been empowering women by giving them opportunities for being
independent and better future. This kind of activities and fulfilling CSR activities is assisting
them in earning brand image so that appreciation can be obtained from all over the world. It has
created positive impact on the revenue.
Freshwater Sustainability: The main focus of Standard Chartered is to save and make
environment effective. They have been working on sustaining freshwater so that natural
resources which are becoming extinct can be saved in effective manner so that troubles which
are being caused can be reduced across the globe in future time (Huimin and Ryan, 2011). This
can be found wastage of time by some of the people but saving freshwater is highly essential
because the water for usage is going scare in nature.
Community Investment: There are various developments and funding done for different
programmes, projects and many more and all of this is being done by all the companies of
banking sector so that support can be provided to the community where all the operations are
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Illustration 1: Standard Chartered SUSTAINABILITY HOMEPAGE

being conducted. This will create little financial burden on the companies but it is highly
essential for completing CSR activities.
ii) Effectiveness of organisational response
Many allegations which were being faced Standard Chartered bank and those allegations
were related to unethical adoption of practices. This is not just single incidence from one country
but also they were fined with huge amount of fine in different nations (Ihlen, Bartlett and May,
2011). In some other cases, number of matter are being handled in appropriate manner but in the
cases which are still remaining, proper steps are not taken. Below are various issues which did
not response is correct way:
Connection with Drug Kingpin: Mistakes were not accepted by the bank that they helped
out drug seller and in the end they had to pay around 2 billion dollars as fine. This was not the
first time they committed the mistakes as earlier they found out guilty in money laundering case
for many times and in current, people have thinking that bank promotes unethical activities. They
may not be guilty but it can not be explained to each and every one (Jo, and Harjoto, 2012).
Poor Performance: Issues were being faced by Standard Chartered regrading low profit
mainly in 2010 and 2012. They fired 25000 employees instead for finding out better solution and
the main reason which was behind terminations was to reduce the cost of business. Many of
them specially financial analysts thought that this was highly unethical and better response was
expected from them like paying out more dividend so that many people can invest and the issues
they were facing could have been vanished.
Following are ethical issues which Standard Chartered corporation handled in impressive
way:
Money laundering: This company did not have one of two issues, they have been facing
many kind of allegations in various part of world they are present in but with time they have
given excellent response to the issues. In 2006 they made “Anti laundering Teams”. This kind of
team accepted that their bank did wrong and also stated that bank has transferred lot of money in
tax heaven and thus they paid fine for wrong doings (Kim and Park, 2011).
Fair Treatment: Many of the people put up the blame that their premium clients and thus
do not care about the small customers. From many incidents, company gained experience and
they started promoting a culture of listening and communicating openly so that effective
response can be observed.
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CSR activities
Standard Chartered is one of the most successful banks. Mainly respective Govt. of any
country has certain expectations from the company who is dealing as foreign company in their
respective country. Company operating at global level has the responsibilities of spending huge
amount on the social activities but CSR is not big issue regarding the company who wants to
take the responsibilities so that they can do something for social where all the operations are
being conducted (Lantolf, Thorne and Poehner, 2015). In a developing country like India, there
are many issues like poverty, literacy rate and education is very poor. Organisation took the
responsibilities of providing training to better up the education level specially to them who does
not have the high education. The main focus of training is on enhancing the skills of
employability so that they can become eligible for good job and can earn livelihood. Women
empowering is another good job which is executed by company. People who normally thinks
that spending money is something what company does in name of CSR activities but Standard
Chartered has done different in developing skills in people who does not possess basic needs.
In current scenario diversity at workplace is trend in an organisation but the cited
organisation already amended this in their policies so it is not even considered as issue. Standard
Chartered is always in the favour of giving equality to every employee and employment was
given to different people from different cultures without considering their religion, race,
language etc. there are some goals which have been set up by this bank which are related to
environment like they took responsibilities of reducing the wastage of paper and water (Lawless,
and Findlay, 2015). But at some moments it is right to say that they are not much serious about
their work which they have taken responsibility of. In order to analyse the effective response in
better way, SWOT analysis can provide help and thus the benefits which have been attained in
past:
Strengths
 Organisation is able to make up its brand name as they perform activities for welfare of
community and also able to strengthen their financial position in market. Company had
build their image as they are involve in carrying activities which are ethical and bringing
improvement in society in developing nations like India.
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 Nearly 270000 people are employed in Standard Chartered for performing duties to
accomplish their objectives and these members are key strength for enterprise as they are
from different cultures.
 Firm is able to cater large number of customers as they are rendering various services
such as investment banking, financial services etc.
Weaknesses
 Clients have make view that Standard Chartered bank do not target on small customers,
this result in decline of their retail business. Every person want to be treated equally but
this become ethical as it may hinder revenue.
 Company is able to make large amount of profit from UK but with time their market is
declining as they are engaging in some unethical practices.
Opportunities
 Bank has expanded their operations as they are opening branches in developing and
underdeveloped countries and this result in fostering their performance. They had make
their business impressive as they are spending large capital for doing CSR work and
providing welfare to society.
 Standard Chartered can improve their retail business which help them to grow their
clients by increasing their investors and by providing ethical standards to cater trust of
customers who are not recently taking services and encourage them to invest they money.
Threats
 Government keeps on changing their policies according to market conditions which
become problem for organisation to timely modify their strategies and system .
 Standard Chartered is required to keep updating their services so that they are able to
maintain their market share and to remain competitive, so that clients do not shift to other
banks.
(iii) Areas of improvement as a response
There are some mistakes whcihy every company makes and thus some flaws are being
present. There are many things which are being done to earn the revenue but there are many
whcih can not be taken all together so its needs to be done in systematic manner. There are some
areas whcih can be enhanced by Standard Chartered in upcoming time:
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Ethics Classes: There are some major changes which needs to take place in ethical
standards. Regular classes should be organised for the senior managers for moral aspect which
company should follow. It will be highly beneficial for company if the people will understand
the affect of fair practices and earning trust of customers. Anti money laundering teams should
be increased as fine work is done by them in past few years but unethical incidents has happen
due to work overload (MA, LIANG, and GAO, 2011).
Increase strength of female employees in growing economies: Diversity is not an issue
for the company specially in countries like US and UK but it can be a major issue in countries
like India and China as there are less number of female workers in Standard Chartered bank.
More women should be hired in an organisation so that they it can be shown that company
supports equality. This can be major opportunity for a women to show their actual skills and
knowledge and this can help them to create different image within society. Although there are no
diversified issues but if they don recruit women now then at higher position there will be no
women present (Moura-Leite and Padgett, 2011).
Rewards programme: Employees who have done excellent work in ethical manner can be
highly motivated to follow other moral standards and thus example can be set for other
employees so that motivation can be applied for promoting culture.
Community work: Main focus should be on execution and controlling, plans should be
made for community work. Vocational training is being provided to many people so that skills
can be developed and thus make them employable. Work which is being related to CSR activities
on monthly basis so that process can be analysed and money can be used for social welfare. Girl
education should be promoted specially in Asia and African region so that aims and objectives of
social and economical factors should be attained.
Sustainable environment: The main focus of this kind of approach is on making green
buildings and avoid paper work. Events should be sponsored by company so that pollution free
environment can be created and apart from that funds should be donated to non gaining
organisation who have been working in this area (Naheem, 2015). They have to become
proactive use their global presence for promoting issue like climate change.
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CONCLUSION
From the above report it can be concluded that there are various external factors which
have potential to influence the strategies and style of working of an organisation. They are
considered as highly essential as they directly or indirectly affect the goodwill of an organisation
along with their profit. There are certain ethical standards on which it is decided whether
company can be trusted or not. Importance of CSR has improved in recent times as various
country's Govt. are asking for the contribution from the large scale business person who have
turnover in millions and billions. CSR has also become a tool of promotion for many corporation
but now a days business world has started taking their accountability in serious way.
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REFERENCES
Books and Journals
Abuznaid, S.A., 2017. Ethics and Corporate Social Responsibility. Social Issues in the
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Banerjee, S.B., 2012. The ethics of corporate social responsibility (pp. 55-76). Taylor and
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Bean, E., 2012. US vulnerabilities to money laundering, drugs, and terrorist financing: HSBC
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Crane, A. and Matten, D., 2016. Business ethics: Managing corporate citizenship and
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Gitsham, M., 2012. Experiential learning for leadership and sustainability at IBM and
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Groves, K.S. and LaRocca, M.A., 2011. An empirical study of leader ethical values,
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Naheem, M.A., 2015. HSBC Swiss bank accounts-AML compliance and money laundering
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Orlitzky, M., Siegel, D.S. and Waldman, D.A., 2011. Strategic corporate social responsibility
and environmental sustainability. Business & society. 50(1). pp.6-27.
Sharma, S., Sharma, J. and Devi, A., 2011. Corporate social responsibility: The key role of
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Online
Corporate Social Responsibility Policy. 2017. [Online]. Available through:
<http://www.about.sc.co.in/sc-in-india/community/corporate-social-responsibility-
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STANDARD CHARTERED SUSTAINABILITY HOMEPAGE. 2017. [Online]. Available through:
<https://https://www.sc.com/en/sustainability/>.
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