Banks' responsibilities (2)

Instead of performing social responsibility in simple ways, such as poverty alleviation and disaster aid, Chinese banks should use financial innovations in performing their CSR. For example, many developed countries have introduced reverse mortgages, which enable the elderly to use their homes as pledges for consumer loans. This allows them to keep the rights to their property while accessing extra funds for daily life. So it is actually a new type of financial product to relieve the pressure on the aged.

In the globalization process, Chinese commercial banks should focus their resources on those projects that contribute more to local environmental protection and social progress. Green credit, which includes all products and services that promote sustainable development, is another development opportunity for Chinese banks.

Technological progress together with new industrial development always boosts the economy. As new energy technology is now leading the next economic boom, research and development in new energy provides Chinese banks with the opportunity to stand with other international banks on the same starting line.

In order to realize a win-win situation, a few leading Chinese banks have implemented a comprehensive CSR strategy in their going-out.

First, they fill up the financing gap in host countries with prompt credit aid.

Second, they realize localization by cultivating local talent to increase tax payments and the employment rate. For instance the overseas branches of Bank of China hired 28,000 local employees between 2006 and 2010. In 2009, $10.6 billion local taxes were paid by China-invested enterprises overseas and 438,000 employees were hired from local communities.

Third, they provide integrated financial services for infrastructure projects, like transportation, water supply and drainage projects, which can largely improve the local conditions. Incomplete statistics show that in Africa, China-invested enterprises supported by Chinese commercial banks have constructed 70 million square meters of housing, 60,000 kilometers of roads and around 3.5 million kilowatts of installed capacity in power stations.