Driving Bank Efficiency with Corporate Social Responsibility

Fajra Octrina and Amara Fatiya Hanif ()
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Fajra Octrina: Telkom University, School of Economics and Business
Amara Fatiya Hanif: Telkom University, School of Economics and Business

A chapter in Proceedings of the International Conference on Sustainable Collaboration in Business, Technology, Information, and Innovation (SCBTII 2024), 2024, pp 408-429 from Springer

Abstract: Abstract This research investigates the influence of Corporate Social Responsibility (CSR) on the efficiency of banks listed on the IDX from 2019 to 2023. The banking sector is crucial for economic stability and growth. Both conventional and Islamic banks have increasingly integrated CSR and Environmental, Social, and Governance (ESG) principles into their operations. Prior studies have shown mixed results regarding CSR’s impact on bank efficiency. This study aims to explore how CSR activities influence bank efficiency. Data Envelopment Analysis (DEA) measures bank efficiency. Results stated that Banks with higher CSR scores are more efficient. Management complexity may impair efficiency in larger institutions. GDP growth and inflation did not directly affect efficiency. CSR positively impacts bank efficiency, particularly when aligned with strategic management. Banks need to improve transparency in CSR reporting and adopt sustainable practices. Future research should delve deeper into these relationships, including more variables and extended study periods.

Keywords: Banking efficiency; Corporate Social Responsibility; Data Envelopment Analysis; Environmental Social Governance (search for similar items in EconPapers)
Date: 2024
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Persistent link: https://EconPapers.repec.org/RePEc:spr:advbcp:978-94-6463-558-4_24

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DOI: 10.2991/978-94-6463-558-4_24

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