CSR Initiatives at HSBC: Making Good Business Sense

Submitted By: Chhavi Bhatnagar Harshit Manik Gunjan Sharma Divyajyoti Dutta Akash Tripathi

CONTENTS
Introduction CSR at HSBC Origin and Evolution Structure and Holding Strategic thrust Translating CSR and Investment HSBC a socially responsible corporate

INTRODUCTION
CSR initiatives at the HSBC Group and how CSR was viewed as complementary to the nature of business at the bank Efforts to incorporated CSR initiatives into the strategic plan of the group and translate it into action across the organization Challenges the group faced in dealing with issues such as financing controversial projects and business process outsourcing. Issues: Incorporation of CSR issues in strategic planning and execution by HSBC

CSR at HSBC
2001: planning the logistics for the movement of 8500 staff from around 20 different sites in central London to its new 45-storey headquarters at Canary Wharf in Londons Docklands district Challenges: disposal of >3000 metric tons of office furniture Options: dispose off through landfill or recycle and reuse Instead landfill option(easier and cost effective), HSBC look at the option of reuse by smaller organizations and charitable trusts partnered with Green-Works to create local jobs and training development Gambia: distributed to schools, hospitals, and a wide range of nongovernment organization projects under the Presidents Award Scheme Cost of disposal through the Green-Works option was 10% higher, but still went ahead as it was in line with their values and principles on environmental management and social responsibility

Group's Origins and Evolution

The bank was founded in 1865, it was positioned as a locally based bank operating on sound Scottish banking principles. The HSBC Group provided a wide range of personal financial services, consumer finance, private banking, commercial banking for small and medium enterprise. As on December 31, 2004, HSBC had an asset base of US$ 1277 billion, a pre-tax profit of US$ 19.4 million The group was one of the largest banking and financial services organizations in the world with wellestablished businesses in Europe, the Asia-Pacific region, the Americas, the Middle East, and Africa.

Group Structure and Holding

HSBC Holdings is a public limited company incorporated in England and Wales. Headquartered in London, the HSBC group operates in five regions: Europe, Hong Kong, the rest of Asia-Pacific including the Middle East and Africa, North America, and South America. HSBC was established as a uniform, international brand name in 1999. In 2002, HSBC launched a campaign to differentiate its brand from those of its competitors by summarizing its unique characteristics with the words, 'The world's local bank'

CSR- A Strategic Thrust

CSR Report ( 2003) Translating CSR into Action within the Organization

Investing in Education , Nature & People

Improved in branding & Rankings Awarded with the Global Bank & Bank of the year.

Translating CSR into action

robust internal systems & procedures Group Standards Manual (roles & functions of key departments) - instruction for individual HSBC business - local circumstances, relevant laws & regulations Employees to take personal responsibility

Investments
Employees volunteered for various community programs contributions & fund raising from corporate houses 2003- US $4.6 million Cancer society 2004- US $69.2 million education, entertainment etc PROJECTS UNDERTAKEN a. Childrens choir (Brazil) b. Young Enterprise (UK) c. exhibition of disadvantaged children d. funding for schools

HSBC A SOCIALLY RESPONSIBLE CORPORATE?

In October 2003, HSBC group faced considerable criticism due to its decision to shift 4000 jobs to less developed nations. Trade unions were outraged and slammed the groups claims of being a model CSR company. HSBC responded by saying that this move was necessary to remain cost competitive in the global scenario. It was also said that creation of jobs in emerging market economies definitely made a positive contribution to society.

HSBC A SOCIALLY RESPONSIBLE CORPORATE?

In 2004, HSBC group has been claimed that it had funded companies that were responsible for the destruction of rain forests in Indonesia and for human rights violations in Sudan. HSBC has also charged that it helped to arrange US$ 1.6 billion in loans and credit guarantees to various companies in the palm oil sector in Indonesia. Companies had reportedly caused deforestation of thousands of acres and polluted the surrounding ecosystem. Critics believed that HSBC could use its influence to make companies become more environmentally conscious.

HSBC A SOCIALLY RESPONSIBLE CORPORATE?

HSBC was also in the news for its links with the controversial Three Gorges Dam in China. HSBC had been hired by the China Development Bank to raise Euro 500 million from Europe and by the Chinese Bank to place another US$ 1 billion of bonds worldwide. Environmentalists claimed that the majority of the money raised from this would go toward various schemes to divert rivers and build dams in China. HSBC insisted that its links to the fundraising effort for the Chinese Government did not go against its environment management and social responsibility policies.

THANK YOU