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The Link between Corporate Social Responsibility and Financial Performance in the Hungarian Banking Sector in the Years Following the Global Crisis

Author

Listed:
  • Nikolett Deutsch

    (Corvinus University of Budapest)

  • Éva Pintér

    (University of Pécs)

Abstract

The hectic economic changes in the past decade and the subsequent regulatory tightening have had a substantial negative impact on the operation of banking service providers. These providers have sought to arrest the decline in their profitability, to re-establish trust with their customers and to reinforce their competitive position with tools that presented banks as institutions which promote corporate social responsibility on the financial and capital markets, involving concepts such as responsible banking, green banking and ethical banking. However, the true extent of this rapid response focusing on corporate social responsibility and its effect on banks’ long-term performance are difficult to measure. This study explores the assessment and measurement methodologies pertaining to the financial sector, and examines a sample of seven dominant market participants in the Hungarian banking sector to determine the relationship between banks’ corporate social responsibility, its integration into operating activities and banks’ financial performance in 2006–2013.

Suggested Citation

  • Nikolett Deutsch & Éva Pintér, 2018. "The Link between Corporate Social Responsibility and Financial Performance in the Hungarian Banking Sector in the Years Following the Global Crisis," Financial and Economic Review, Magyar Nemzeti Bank (Central Bank of Hungary), vol. 17(2), pages 124-145.
    • Handle: RePEc:mnb:finrev:v:17:y:2018:i:2:p:124-145
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    References listed on IDEAS

    as
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    4. Darren D. Lee & Robert W. Faff & Kim Langfield-Smith, 2009. "Revisiting the Vexing Question: Does Superior Corporate Social Performance Lead to Improved Financial Performance?," Australian Journal of Management, Australian School of Business, vol. 34(1), pages 21-49, June.
    5. Daniel Tschopp PhD, 2012. "Drivers of corporate social responsibility reporting; Case studies from three reporting companies," International Journal of Business and Social Research, MIR Center for Socio-Economic Research, vol. 2(2), pages 1-11, April.
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    Cited by:

    1. Krisztina Szegedi & Yahya Khan & Csaba Lentner, 2020. "Corporate Social Responsibility and Financial Performance: Evidence from Pakistani Listed Banks," Sustainability, MDPI, vol. 12(10), pages 1-19, May.

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    More about this item

    Keywords

    corporate social performance (CSP); corporate financial performance (CFP); banking sector; Scholtens CSP;
    All these keywords.

    JEL classification:

    • G00 - Financial Economics - - General - - - General
    • G20 - Financial Economics - - Financial Institutions and Services - - - General
    • G21 - Financial Economics - - Financial Institutions and Services - - - Banks; Other Depository Institutions; Micro Finance Institutions; Mortgages
    • G30 - Financial Economics - - Corporate Finance and Governance - - - General

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