Thursday, 20 January, 2022
E-paper

BB releases updated CSR guideline for banks, FIs

BB releases updated CSR guideline for banks, FIs

Bangladesh Bank has directed the financial institutions to spend a minimum of 60 per cent of their corporate social responsibility (CSR) funds in education and health sectors equally and 20 per cent on the environment and climate change issues.

The central directives came on the updated CSR guidelines for banks and financial institutions (FIs) in line with sustainable development goals (SDG).

Financial institutions must spend a minimum of 60 per cent of their total CSR budget in education and health sectors equally, according to the guideline released by the central bank’s Sustainable Finance Department on Monday.

Economists and bankers have hailed the initiative saying that the directive will help ensure the optimum use of CSR funds to support the country’s development.

Policy Research Institute (PRI) executive chairman Dr Ahsan H Mansur said the banks always spend the CSF fund for community development based on their operational areas.

“The guideline for CSR is a good initiative from Bangladesh bank that we can follow. We stood by the people amid pandemic based on innovative policies. Many banks also provided food support to the underprivileged people,” Dr Ahsan H Mansur, Brac Bank chairman told the Daily Sun on Monday.

The eminent economist also suggested incorporating food rationing programmes in the banks’ CSR guideline for supporting the ‘new poor’ amid the pandemic to support inclusive development.

The banks and FIs were also asked to support farmers’ access to better technology in the fields of crop diversification, livestock, fisheries, and poultry.

For any programme promoting job opportunities, self-employment and skill development for youth can be funded from the CSR budget of the banks, according to the guideline.

Former chairman of Association of Bankers Bangladesh (ABB) Syed Mahbubur Rahman said the CSR guideline will help the banks allocate funds more systemically and based on the government’s development priorities.

“The health sector is very important for us as we realized during the pandemic. Besides, education is the backbone of a nation. Sports are important but less than education. I think the guideline will guide the banks’ efforts to utilise CSR funds for the wellbeing of the society and the country,” Syed Mahbubur Rahman, managing director of Mutual Trust Bank, told the Daily Sun.

In the education sector, the banks and FIs can run scholarships and stipend programmes for students from low-income families in academic and vocational training institutions. Besides, the authorities can support the upgradation of facilities in academic and technical/vocational training institutions.

The banks can support the underprivileged people to get better access to treatments for diseases and medical conditions including cancer, kidney disease, heart disease, liver disease, accidental operation, fire burn, acid burn, and cataract eye surgeries. The organizations working on well being of mentally and physically challenged people can avail support from CSR funds.

In the guideline, Bangladesh Bank said it is the first central bank to initiate green banking activities by promoting environment-friendly practices and reducing carbon emissions through banking activities.

Banks can contribute to infrastructure development for the rural people including establishing school buildings for vulnerable groups, libraries, children's parks, playgrounds, recreation centres, and cultural centres related to art, music, dance, painting, the guideline suggests.