Md. Riazul Haque, Md. Manjurul Haque

Corporate Social Responsibility in Islamic Banks of Bangladesh: A Trend Analysis

Introduction

Corporate social responsibility in islamic banks of bangladesh: a trend analysis. Analyze CSR trends and expenditures in Bangladesh's Islamic banks (2018-2022). Evaluate contributions, effectiveness, and alignment with Islamic ethics for comprehensive, sustainable practices.

Abstract

Objective: The study aims to explore the sector-wise contributions to Corporate Social Responsibility activities by full-fledged Islamic banks of Bangladesh and Evaluate the consistency and effectiveness of CSR practices across different Islamic banks. Theoretical framework: The theoretical framework for this study is grounded in Stakeholder Theory and Islamic Ethical Principles, emphasizing the obligation of Islamic banks to uphold social justice, transparency, and community welfare. It explores how Shariah-compliant institutions integrate CSR into operations, guided by both religious values and stakeholder expectations and analyzes emerging trends in their CSR practices in Bangladesh. Literature review: The literature review includes data and publications central bank (Bangladesh Bank), academic papers, reports from Islamic banks, articles, and previous research studies, reputable news outlets, financial reports, and different publications from both government and non-governmental organizations involved in CSR initiatives of Bangladesh. Methods: This study utilizes CSR expenditure data from full-fledged Islamic banks, covering the period from (July to December) 2018 to 2022, sourced primarily from Bangladesh Bank publications. Tables, graphs, and charts will be employed to visually represent the data and support the interpretation of the findings. Results: The analysis reveals a steady increase in CSR expenditures and a growing emphasis on key sectors such as disaster management, healthcare education, etc. From 65.69 Crore BDT in 2018 (July- December) to 255.07 Crore BDT in 2022 (July- December), representing more than a quadrupling of the initial amount. Implications: These findings These findings provide important implications for stakeholders. The trend analysis of CSR practices in Islamic banks in Bangladesh indicates a steady yet encouraging development in their social responsibility efforts. While many banks are actively contributing to areas like charity, healthcare, and education, a truly comprehensive approach that reflects Islamic ethical principles and a focus on long-term sustainability is still missing. Novelty: The novelty of this study lies in its cross-biannual comparative approach and specific focus on the expenditure of full-fledged Islamic banks in corporate social responsibility, which has not been systematically studied in the context of Bangladesh.

Review

This study, "Corporate Social Responsibility in Islamic Banks of Bangladesh: A Trend Analysis," addresses a highly relevant and under-explored area within Islamic finance. The clear objective to explore sector-wise CSR contributions and evaluate their consistency and effectiveness within full-fledged Islamic banks in Bangladesh is commendable. The theoretical framework, grounded in Stakeholder Theory and Islamic Ethical Principles, is particularly appropriate, establishing a strong conceptual foundation for understanding how Shariah-compliant institutions integrate CSR, guided by both religious values and stakeholder expectations. The explicit mention of a cross-biannual comparative approach and a specific focus on expenditure offers a novel perspective in the context of Bangladesh, promising unique insights into the evolution of CSR practices in this distinct financial sector. The methodology, utilizing biannual CSR expenditure data from Bangladesh Bank publications for 2018-2022, provides a robust quantitative basis for trend analysis, effectively supported by visual representations like tables, graphs, and charts. The results clearly demonstrate a substantial increase in CSR expenditures, quadrupling from BDT 65.69 Crore in 2018 to BDT 255.07 Crore in 2022, with a growing emphasis on critical sectors such as disaster management, healthcare, and education. While this trend analysis of increasing financial commitment is a significant finding, the abstract's self-assessment that "a truly comprehensive approach that reflects Islamic ethical principles and a focus on long-term sustainability is still missing" points towards a potential area for deeper analytical engagement. Future iterations or discussions within the paper could elaborate on what constitutes such a 'comprehensive approach' beyond just financial outlay and how the observed trends align with the deeper philosophical underpinnings of Islamic ethics mentioned in the theoretical framework. Overall, this study makes a valuable contribution by systematically analyzing the quantitative trends in CSR expenditures by Islamic banks in Bangladesh. The findings offer important implications for stakeholders, providing an encouraging snapshot of developing social responsibility efforts within the sector. While the current focus on expenditure trends is an excellent starting point, future research building upon this foundation could extend to qualitative assessments of the impact and effectiveness of these initiatives, critically evaluating their alignment with the broader goals of social justice and community welfare inherent in Islamic ethical principles. This paper serves as an essential initial step in understanding the evolving landscape of CSR in Islamic banking in Bangladesh, laying groundwork for more nuanced and impact-oriented investigations.

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