Mapping Corporate Social Responsibility: Unveiling Compliance and Expenditure Trends in Public and Private Sector Banks (2013-2020)

This research report thoroughly and minutely examines the compliance of Corporate Social Responsibility activities through item-wise aggregate analysis of nominated public sector banks and private sector banks from 2013-20. Furthermore, the amount spent on different CSR activities in accord with the provisions of the Companies Act 2013 has been investigated. The study is vivid in nature and is based on secondary data. The researchers presented the results using tables and graphs.

1. Any company with a net worth of at least Rs.500 crores,or 2. A turnover of at least Rs.1000 crores, or 3. A net profit of at least Rs. 5 crores.In financial year, company has to constitute, corporate social responsibility committee of minimum 3 directors and majority independent directors.A Company has to provide a list of CSR Projects or program which are falling within the purview of Schedule VII.According to which it is obligatory designed for the organization to employ 2% of average profits of last 3 years in Corporate Social Responsibilities projects and events.Corporations must form a CSR board that develops a CSR policy that was permitted by the board of directors and outlines the CSR activities that the corporation is enthusiastic to undertake.The act also includes penalties for corporations and individuals who do not comply with the rules.

Status of CSR in Indian Banking System.
The banking sector is critical to India's economic prosperity.Banks are providing various numbers of schemes for helping small entrepreneurs, artisans, old age pension schemes, women empowerment, Scholarships to students, micro small medium enterprises.Accordingly II Schedule of Reserve Bank of India Act, 1934, those banks which have a paid-up capital and reserves of a gross value of at least Rs. 5 Lakhs are included in Scheduled banks.In present scenario, scheduled commercial banks are distributed into 6 categories-12 Public Sector Banks, 22 Private Sector Banks, 10 Small Finance Banks, 2 scheduled Payments Banks, 43 regional Rural Banks, and 46 foreign Banks.There are four phase of CSR practices in India • Early Philanthropy (Pre-2000s): In this phase, CSR activities were largely driven by philanthropic initiatives taken by companies voluntarily.There was no regulatory framework mandating companies to occupy in CSR activities.• Mandatory CSR Provision (2014-2019): The Companies Act of 2013 introduced a mandatory CSR provision for companies meeting convinced financial criteria.This phase marked the beginning of a formalized approach to CSR, with companies crucial to allocate a certain percentage of company's profits towards CSR activities.• Strategic CSR (2019-Present): Over time, companies started to view CSR as a strategic tool for sustainable development and long-term business growth.CSR initiatives became more focused, aligned with a company's core values, and integrated into their business strategies.• Sustainable and Impactful CSR (Present and beyond): This phase involves a heightened emphasis on the impact and outcomes of CSR initiatives.Companies are not only focusing on meeting regulatory requirements but also striving to create meaningful and sustainable changes in areas such as education, healthcare, environment, and social development.It is crucial to keep in mind how the stages are not exactly linear, and they may overlap.CSR practises in India have evolved from ad hoc giving to a more deliberate and impact-driven approach.

Review of Literature.
Corporate Social Responsibility (CSR) has received a lot of attention as companies try to reconcile their financial goals against their obligations regarding the environment and society.This systematic literature review aims to synthesize and analyze key findings from various studies related to CSR practices in the banking sector.
(Das, S. K., & Padhy, D. M., 2019) focused on the influence of CSR on share prices of public and private banks.Based on annual reports from 2014 to 2018, they found that CSR positively influenced share prices of private sector banks but had an adverse effect on public sector banks' share prices.Interestingly, public sector banks exhibited a dynamic increase in CSR spending, while private sector banks displayed a more consistent upward trend.(Radzi et al., 2018) The research examined and described the use of an integrated tactic in the forecasting and execution of CSR activities in the banking industry.According to the findings of the study, it is critical that the problem of sustainability and the incorporation of CSR into core banking activities be addressed to acquire the assurance of investors.This was anticipated that it will give recommendations to the banking industry in planning and carrying out CSR initiatives in an additional systematic and universal manner.(Kaur and Sehgal, 2018) investigated the impression of CSR initiatives on banks' financial performance.By examining the relationship between CSR practices and variables such as bank size, return on assets (ROA), and return on equity (ROE), they found that banks that engaged in CSR activities tended to exhibit improved financial performance.Interestingly, despite larger banks having a stronger influence on CSR spending, the actual CSR spending remained below potential levels.(Dey, S. K., & Dash, A. P., 2018) emphasized the significance of CSR for Indian companies.The study utilized purposive sampling to select companies, analyzing secondary data spanning from 2008 to 2015.They observed various aspects of CSR and their influence on financial performance and stakeholders.The study underscored the need for a comprehensive approach to CSR to enhance financial outcomes.(Chopra, I. P., 2017) Banks are directly active in CSR activities, primarily related to rural development, education, social services, women and child improvement, and public health programmes.According to the corporations Act of 2013, corporations are required to invest 2% of company income on CSR.According to the report, banks are making efforts to adopt CSR, but are not allocating their 2% profit share to CSR. (Singh, P. K., & Das, B. K. (2016) compared the CSR activities of State Bank of India (SBI) and ICICI Bank over the period 2010-2015.In Study, both banks' efforts in education, livelihood creation, healthcare, and disaster relief.The study results highlighted that while both banks prioritized CSR activities, their approaches varied.(Gupta and Agrawal, 2015) explored the CSR contributions of seven public banks and three private banks selected from India's top ten banks.In study, it was correlated CSR contributions with the banks' total income for the fiscal year 2013-2014.The study revealed that higher income banks tend to allocate more resources to CSR activities.Furthermore, social issues received greater attention compared to environmental concerns within the CSR initiatives of the selected banks.(Singh, N., Srivastava, R., & Rastogi, R. 2013) analyzed CSR priorities and reporting in private and public sector banks.It was noted that CSR operations were prioritized by banks; however, transparency in CSR reporting remained lacking.The study emphasized the importance of proper monitoring and highlighted the role of banks in contributing to societal welfare.In conclusion, the systematic review showcases the evolution of CSR practices in the banking sector.The studies collectively highlight the significance of CSR contributions, their impact on financial performance, and the part of transparency in reporting.Despite differences between public and private sector banks, the common thread is the growing importance of CSR as a tool for creating social value and aligning business goals with societal well-being.

Statement of the Problem.
Various studies have been performed on CSR with respect to its compliance and performance of the Companies more specifically financial performance.But hardly any study has been performed to check the item wise compliance of various CSR activities extensively.The researchers have tried to look in to both the degree of compliance of CSR provisions as well as the amount spent on various activities minutely and extensively.

Objectives of the Study
In order to study the degree of compliance of CSR and the amount spent on various activities by Public sector banks and Private sector banks, the following sub-objectives have been formed.

Hypothesis of the Study.
The researchers hypothesizes as under with respect to compliance of CSR among both public sector banks and private sector banks after going through the item-wise aggregate composite analysis: Since 2013 the compliance of CSR has been made mandatory and banks have progressively shown better compliance for the same.Therefore the researchers hypothesizes: 1) Both Public and Private sector Banks have complied for almost same numbers of activities with a mixed result.It is also likely that both Public sector Banks and Private Sector Banks have spent the amount earmarked for CSR Activities, however there is difference in the amount of spending for CSR activities.Therefore the researchers hypothesizes: 2) The Private Sector Banks have spent more amount on CSR activities in comparison to Public Sector Bank.

Research Methodology.
The study is observational in nature, since it describes the condition of CSR compliance in public and private sector banks.The researchers planned to take 10 banks (both Public sector and Private sector) as sample but on the basis of available information we choose only 5 banks each sector and the period of the study from 2013-2020 has been selected.For Public sector bank: Bank of India, Canara Bank, Punjab National Bank, UCO Bank, Union Bank of India And For Private Sector Bank: Axis Bank, Federal Bank, ICICI Bank, South India Bank, Yes Bank.Relevant tables and graphs have been used to show and describe the data in tandem with the objectives of the study extensively and minutely.

Descriptive Analysis
The study has progressed as per its objectives, in order to verify the proposed hypothesis.At the onset the researchers tried to find out the compliance of CSR activities as per the item wise aggregate analysis that as per with the provisions of the Companies Act 2013 for each bank under both public as well as private sector bank.To study the same an item-wise aggregate analysis was done for both types of Banks.
After making an item-wise aggregate analysis for both Public and Private Sector Banks we have traced a composite aggregate item-wise analysis of CSR activities for both Public sector as well as Private sector Banks in order to find a trend of compliance for CSR activities to prove the hypothesis of the study.The researchers laid down a measure to check for the composite item-wise aggregate analysis for CSR activities by assuming the compliance in the following categories for the seven years study period.Upon evaluating the above composite item-wise aggregate analysis, it is evident that both public sector banks and private sector bank have been found to follow same trend for the compliance of various CSR activities barring one or two activities.Therefore, the hypothesis of the study "Both Public and Private sector Banks have complied for almost similar numbers of activities with a mixed result" found to be true.

Total amount spent on various CSR activities by Public sector bank and Private sector banks in order in order to trace a trend for the same.
Here the researchers investigated into the entire amount disbursed on various CSR activities, as per items taken into "item-wise aggregate analysis", the details of which have been presented in the following tables and graphs.In total Five Public Sector Banks have been taken into consideration for the analysis.Rather than preparing or presenting graph of public sector bank for corporate social responsibility, we will be mentioning or describing the table as formed already.Because in number of years it has been found that Banks were either in Losses or mentioned that they have simply complied with CSR activities, without showing the absolute figures as per their Annual Reports published from time to time.

A -Total amount (2% of Net Profits) earmarked for CSR. B -Actual amount spent on CSR. C-Difference or Amount not spent (Left unspent).
Table :  In addition it is worth to mention that the bank has consistently been complying CSR provisions irrespective of the fact that the data for the same have not been mentioned in the annual report of the bank but the number and nature of CSR activities were very well specified.Besides the bank has clearly mentioned the following para in its yearly annual reports taken up for study period.* As per BSE India Annual Report, "A new provision in Company Act, 2013 has mandated expenditure under CSR for the companies formed under the Act.Even though Bank of India does not come under this category, as a responsible corporate citizen, the Bank has been participating in CSR activities for the worthy causes."respectively thereby leaving a gap of 1.78%, 1.25%, 1,48%, and 0.70% for the same.In year 2017-18 bank has spent the amount of Rs.5.55 cr for the various CSR Activities even though having loss in the same and in the year 2019-20 so the bank is not qualified for CSR for both the years.

Private sector Bank
In order to show the trend two graphs were prepared, one for absolute amount and another for percentage.
The following tables and graphs clearly presenting the total amount spent on CSR activities as well as its percentage that in itself is self-explanatory.

B (In Percentage)
Fig: 2 1.FEDERAL BANK The following tables and graphs clearly presenting the total amount spent on CSR activities as well as its percentage that in itself is self-explanatory.

ICICI BANK
The following tables and graphs clearly presenting the total amount spent on CSR activities as well as its percentage that in itself is self-explanatory.

Bank-3 ICICI Bank
A B C Fig: 6 2

. SOUTH INDIAN BANK
The following tables and graphs clearly presenting the total amount spent on CSR activities as well as its percentage that in itself is self-explanatory.

Bank-4 (South India Bank)
A B C

YES BANK
The following tables and graphs clearly presenting the total amount spent on CSR activities as well as its percentage, which in itself is self-explanatory.From the above tables and graphs it is evident that the spending on CSR activities by Private Sector Banks is comparatively higher than the Public Sector Banks.Therefore the hypothesis for the study "the Private Sector Banks have spent more amount on CSR activities in comparison to Public Sector Bank" happens to be true.

Scope of the study
The study's focus is confined to an analysis of corporate social responsibility conformance in selected Indian public and private sector banks.It especially refers to compliance with corporate social responsibility as defined by the Companies Act of 2013.

Limitation of the study
The study is constructed on the corporate governance report of the banks which in itself is a separate section in an annual report as corporate social responsibility form the part of the same.In certain cases relevant data cannot be obtained from the source data i.e annual report has become another limitation for the study.In case data is not available regarding the compliance of a certain parameter by a certain bank.It is taken as not available in that parameter by that bank.Further the views have not taken into the study.

Annexures:
1. Item-wise aggregate analysis for individual Bank First of all we have taken the item-wise aggregate analysis of Public Sector Banks which is as follows: Bank 1-Bank of India

1 )
An item-wise aggregate analysis for the degree of compliance of CSR among Public sector banks and Private sector banks.2) Total amount spent on various CSR activities by Public sector bank and Private sector banks in order to trace a trend for the same.As per the objectives of the study a list of items has been traced out of the CSR provisions as cited in the Companies Act 2013.

1 BANK OF INDIA Trend of CSR Compliance S.No Specific CSR Activities referred under Schedule VII to the Company Act
For the compliance, we have taken Y in the above table.Source: https://bankofindia.co.in/annual-reports.htmlBank-2.CANARA BANK

6 Activities concerning benefit to Armed Forces, veterans, war widows and their dependents
For the compliance, we have taken Y in the above table.Source: https://canarabank.com/annual-reports.html • Email: editor@ijfmr.comIJFMR23056353 Volume 5, Issue 5, September-October 2023 21 i.Contribution to PM National relief fund or any other fund Y

.No Specific CSR Activities referred under Schedule VII to the Company Act 2013- 14 2014- 15 2015- 16 2016- 17 2017- 18 2018- 19 2019- 20 1 Activities concerning basic necessities of life
For the compliance, we have taken Y in the above table.

6 Activities concerning benefit to Armed Forces, veterans, war widows and their dependants
For the compliance, we have taken Y in the above table.Source: https://www.ucobank.com/English/annual-report.aspx

UNION BANK OF INDIA Trend of CSR Compliance S.No Specific CSR Activities referred under Schedule VII to the Company Act 2013- 14 2014- 15 2015- 16 2016- 17 2017- 18 2018- 19 2019- 20 1 Activities concerning basic necessities of life
• Email: editor@ijfmr.comIJFMR23056353 Volume 5, Issue 5, September-October 2023 29 Note: For the compliance, we have taken Y in the above table.Source: https://www.unionbankofindia.co.in/pdfItem-wise aggregate analysis for Private Sector Banks which is as follows:

. FEDERAL BANK 2 FEDERAL BANK Trend of CSR Compliance S.No Specific CSR Activities referred under Schedule VII to the Company Act
For the compliance, we have taken Y in the above table.Source: https://www.federalbank.co.in/annual-reportsFor the compliance, we have taken Y in the above table.Source: https://www.southindianbank.com/content/investor-desk-annual-reports/911Never iii.Setting up of homes and hostels for women and orphans Never iv.Setting up old age homes & Senior citizen welfare, day care center Never

Activities concerning benefit to Armed Forces, veterans, war widows and their dependents
i. Measures for the benefit of armed forces, veterans, war widows and their dependents For the compliance, we have taken Y in the above table.Source: https://www.yesbank.in/about-us/investors-relation/financial-information/annual-reports

Table : 1
Composite Aggregate item-wise study of CSR Activities for Public and Private Sector Banks