Differentiating between Sincere and Insincere Corporate Social Responsibility (CSR) : Evidence from the German Banking Industry
Languages of publication
This paper analyses the difference in the CSR commitment between different types of banks, based on the German example. It compares the three traditional groups (Commercial, Cooperative and Savings Banks) and a new type of bank which emerged in the 1980s: ethical banks. For each of these four types of financial institution, the main objective is to see if there is a difference between what the banks declare (through analysis of CSR policies in their annual reports) and what the banks actually do (through analysis of their financial statements). The conclusion is that a sincere commitment to CSR involves a substantial change in the banks business model. An analysis of the banking industry shows that only a few institutions are ready to take a step forward in this direction.
- Abott, W.F. and Monsen, R.J. (1979): "On the Measurement of Corporate Social Responsibility: Self-Reported Disclosures as a Method of Measuring Corporate Social Involvement", Academy of Management Journal, vol. 22, n° 3, pp. 501-515.
- Alexander, G.J., and Buchholz, R.A. (1978): "Corporate Social Responsibility and Stock Market Performance", Academy of Management Journal, vol. 21, n° 3, pp. 479-486.
- Aupperle, K.E., Carroll, A.B., and Hatfield, J.D. (1985): "An Empirical Examination of the Relationship Between Corporate Social Responsibility and Profitability", Academy of Management Journal, vol. 28, n° 2, pp. 446-463.
- Ayadi, R., Schmidt, R.H., and Carbo Valverde, S. (2009): Investigating Diversity in the Banking Sector in Europe: the performance and role of Savings Banks, Centre for European Policy Studies, Brussels.
- Bakan, J. (2004): The Corporation: The Pathological Pursuit of Profit and Power, Free Press, New York.
- Berle, A. (1931): "Corporate Powers as Powers in Trust", Harvard Law Review, vol. 44, n° 7, pp. 1049-1074.
- Bowen, H.R. (1953): Social Responsibilities of the Businessman. New York: Harper & Brothers.
- Brammer, S., Jackson, G., and Matten, D. (2012): "Corporate Social Responsibility and Institutional theory: New Perspectives on Private Governance", Socio-Economic Review, vol. 10, pp. 3-28.
- Callan, S.J. and Thomas, J.M. (2009): "Corporate Financial Performance and Corporate Social Performance: An Update and Reinvestigation", Corporate Social Responsibility and Environmental Management, vol. 16, pp. 61-78.
- Carroll, A.B. (1979): "A Three Dimensional Conceptual Model of Corporate Social Performance", Academy of Management Review, vol. 4, n° 4, pp. 497-505.
- Carroll, A.B. (1991): "The Pyramid of Corporate Social Responsibility: Toward the Moral Management of Organizational Stakeholders", Business Horizons, vol. 34, iss. 4, pp. 39-48.
- De Clerck, F. (2009): "Ethical Banking", in Zosolnai, L., Boda, Z., and Fekete, L., eds.: Ethical Prospects: Economy, Society and Environment, Berlin, Springer, pp. 209-227.
- DiMaggio, P.J. and Powell, W. (1983): "The iron cage revisited: institutional isomorphism and collective rationality in organizational fields", American Sociological Review, vol. 48, pp. 147-160.
- Dodd, E. M. (1932): "For Whom Are Corporate Managers Trustees?, Harvard Law Review, vol. 45, n° 7, pp. 1145-1163.
- Durbin, A., Herz, S., Hunter, D., Peck, J. (2006): Shaping the Future of Sustainable Finance: moving from paper promises to performance. London: BankTrack.
- Eisenhardt, M.K. (1989): "Agency Theory: An Assessment and Review", Academy of Management Review, vol. 14, n° 1, pp. 57-74.
- Freeman, R.E. (ed. 2010): Strategic Management: A Stakeholder Approach. Cambridge, U.K.: Cambridge University Press (first published in 1984).
- Friedman, M. (1970): "The Social Responsibility of Business is to Increase its Profits", The New York Times Magazine, September 13, pp. 30-35.
- Garcia-Castro, R., Arino, M.A., and Canela, M.A. (2009): "Does Social Performance Really Lead to Financial Performance? Accounting for Endogeneity", Journal of Business Ethics, vol. 92, n° 1, pp. 107-126.
- Giddings, B., Hopwood B. and G. O'Brien (2002): Environment, Economy and Society: fitting them together into sustainable development, Sustainable Development, vol. 10, issue 4, pp. 187-196.
- Jensen, M.C. (2001): "Value Maximization, Stakeholder Theory, and the Corporate Objective Function", European Financial Management, vol. 7, n° 3, pp. 297-317.
- Jensen, M.C. and Meckling, W.H. (1976): "Theory of the Firm: Managerial Behavior, Agency Costs, and Ownership Structure", Journal of Financial Economics, vol. 3, n° 4, pp. 305-360.
- Jeucken, M. (2001): Sustainable Finance and Banking: the Financial Sector and the Future of the Planet, Earthscan Publication Ltd, London.
- Laan, G., Ees, H., and Witteloostuijn, A. (2007): "Corporate Social and Financial Performance: An Extended Stakeholder Theory, and Empirical Test with Accounting Measures", Journal of Business Ethics, vol. 79, n° 3, pp. 299-310.
- Loiselet, E. (2000): "L'investissement socialement responsable: genèse, méthodes, enjeux", L'économie politique, vol. 7, pp. 6-31.
- Lopez, M.V., Garcia, A., and Rodriguez, L. (2007): "Sustainable Development and Corporate Performance: A Study Based on the Dow Jones Sustainability Index", Journal of Business Ethics, vol. 75, n° 3, pp. 285-300.
- Makni, R., Francoeur, C., and Bellavance, F. (2008): "Causality Between Corporate Social Performance and Financial Performance: Evidence from Canadian Firms", Journal of Business Ethics, vol. 89, n° 3, pp. 409-422.
- Margolis, J., H. Elfenbein, and J. Walsh (2007): Does it Pay to Be Good? A Meta-analysis and Redirection of Research on the Relationship Between Corporate Social and Financial performance, Working Paper, Ross School of Business, University of Michigan.
- Neville, B.A., Bell, S.J., and Mengüç, B. (2005): "Corporate reputation, stakeholders and the social performance-financial performance relationship", European Journal of Marketing, vol. 39, issue 9/10, pp. 1184-1198.
- Orlitzky, M., Schmidt, F.L., and Rynes, S.L. (2003): "Corporate Social and Financial Performance", Organization Studies, vol. 24, n° 3, pp. 403-441.
- Palomo, R. and Carrasco, I. (2001): "Le caractère spécifique des groupes bancaires coopératifs dans un environnement financier global", in Côté, D. (ed.), Les holdings cooperatives, Brussels, De Boeck Université, pp. 139-160.
- Parkinson, J. and Kelly, G. (2001): "The Conceptual Foundations of the Firm", in Parkinson, J., Gamble, A., and Kelly, G., eds.: The Political Economy of the Company, Oxford, Hart Publishing, pp. 113-140.
- Paulet, E. and Relano, F. (2011): "Navigating the Financial Crisis in Helvetic Waters: An Analysis of the Banking Sector", Journal of Risk Governance & Control: Financial Markets and Institutions, vol. 1, n° 2, pp. 65-78.
- Peters, R. and Mullen, M.R. (2009): "Some Evidence of the Cumulative Effects of Corporate Social Responsibility on Financial Performance", Journal of Global Business Issues, vol. 3, n° 1, pp. 1-15.
- Redler, E. (1994): European financial sector privatization and demutualization: trends, practices and effects, London, Financial Times Management Report.
- Relano, F. (2008): "From Sustainable Finance to Ethical Banking", Transformations in Business & Economics, vol. 7, n° 3, pp. 123-131.
- Relano, F. and Paulet, E. (2012): "Corporate responsibility in the banking sector: a proposed typology for the German case", International Journal of Law and Management, Vol. 54, Iss. 5, pp. 379-393.
- Rettab, B., Brik, A.B. and Mellahi, K. (2008): "A Study of Management Perceptions of the Impact of Corporate Social Responsibility on Organisational Performance in Emerging Economies: The Case of Dubai", Journal of Business Ethics, vol. 89, n° 3, pp. 371-390.
- Saeed, K. (2004): "Designing an environmental mitigation banking institution for linking the size of economic activity to environmental capacity", Journal of Economic Issues, vol. 38, n° 4, pp. 909-937.
- Scholtens, B. (2009): "Corporate Social Responsibility in the International Banking Industry", Journal of Business Ethics, vol. 86, n° 2, pp. 159-175.
- Schreck, P. (2011): "Reviewing the Business Case for Corporate Social Responsibility: New Evidence and Analysis, Journal of Business Ethics, vol. 103, n° 2, pp. 167-188.
- Smith, A. (1776): An Inquiry into the Nature and Causes of the Wealth of Nations. London: printed for William Strahan and Thomas Cadell, vol. 2.
- Soana, M.G. (2011): "The Relationship between Corporate Social Performance and Corporate Financial Performance", Journal of Business Ethics, vol. 104, n° 1, pp. 133-148.
- Van Gelder, J.V. (2007): Buyers and Financiers of the Wilmar Group, Amsterdam, Profundo.
- Van Gelder, J.V. and Denie S. (2007): Mind the Gap: benchmarking credit policies of international banks, Utrech, BankTrack.
Publication order reference