CORPORATE SOCIAL RESPONSIBILITY AND TASK PERFORMANCE OF COMMERCIAL BANK IN PORTHARCOURT

ABSTRACT

The study examined the corporate social responsibility and task performance of commercial bank in Portharcourt, Nigeria. The survey research was used in this study to sample the opinion of respondents. This method involved random selection of respondents who were administered with questionnaires. Relevant conceptual, theoretical and empirical literature was reviewed. The target population of the study comprised selected students from Nile University, Nigeria. Three hundred (300) respondents constitute the sample size for this study. The descriptive and analytical approach was adopted using Chi-square to test and analyze the hypotheses earlier stated. Findings revealed that there is a significant impact of corporate social responsibility on task performance of commercial bank in Portharcourt, Nigeria. Findings of the study also reveals that lack of stakeholder involvement and incentive is one of the factors that mitigate the corporate social responsibility of commercial bank in Portharcourt, Nigeria. Findings of the study also reveals that there is a significant relationship between corporate social responsibility and task performance of commercial bank in Portharcourt, Nigeria. Finally, finding of the study further reveals that engaging with stakeholders and solicit feedback is one of the ways of improving he practices of corporate social responsibility of commercial bank in Portharcourt, Nigeria. It was therefore concluded that corporate social responsibility significantly impacted on task performance in Commercial banks in Port harcourt, Nigeria. It was recommended that Nigerian banks should leverage on corporate social responsibility practices to achieve their shareholders interest of profit maximization and invariably their corporate objectives.

CHAPTER ONE

INTRODUCTION

1. Background of the Study

Numerous studies have shown that the banking sector is facing challenging times, both internationally and in African nations like Nigeria. Organisations have adopted a variety of tactics, from technical advancements to policies addressing competition and marketing, in an effort to increase the efficiency of banks (Mwangi & Wanjira, 2019). One of the most popular tactics in many organisations is corporate social responsibility. Academics have endeavoured to explicate the primary rationale for business firms' voluntary engagement with the social welfare of others via their operations(Mwangi & Wanjira, 2019). According to Bowen (1953), the majority of businesses engage in charitable and social endeavours only to establish their legitimacy as members of the community and support the long-term viability of their businesses.

The present foray into sophisticated financial operations has resulted in an increase in risk and a drop in revenue, according to empirical study that evaluated banks' global performance and overall standing (Gallego-Álvarez et al., 2011). An oddball photo usually surfaces outside of the United States.According to Bowman & Haire's (2014) analysis of the overall performance of a subset of banks in 15 EU member states, noninterest revenue has become more erratic than interest income, meaning that banks across the continent are not doing much better. In addition, they discovered a negative association between two bank revenue sources, which, in contrast to US research, led them to the conclusion that income other than interest income stabilises bank revenue.This helps to explain why, over an extended period of time, large European financial institutions have consistently outperformed tiny banks (based on market-based metrics) (Barney, 2011). Evidence from other regions of Europe, however, indicates that tiny banking institutions would be better off focusing on conventional business areas rather than pursuing income-generating ventures that are not dependent on interest (Marcia et al., 2013).

Generally speaking, the USA and other first-world nations are going through a severe financial crisis, with the Citibank group reporting losses exceeding forty billion dollars (Elliot et al., 2014). Nonetheless, Elliot et al. (2014) attribute the resilience of Canadian banks to both a cultural attitude inherent in Canadian banks and regulatory rigour. These factors have allowed Canadian banks to weather the storm in the global financial market. The majority of academics have focused their investigations on certain European nations.Adeboye & Olawale (2012) found that the new entrance into the variety of assets across bank loan portfolios had enhanced bank performance, based on a sample of Italian banks. Iya et al. (2015) evaluated the extent to which the banking activities offered in various organisations and areas increased efficiency using data from a number of German banking institutions and their unique bank loan portfolios. They discovered few advantages, with all ongoing operations playing a major role in the decline in bank efficiency.

Okiro, Omoro, and Kinyua (2013) conducted the most comprehensive study of its kind, evaluating the impact of banking operations on the value of 42 large financial institutions. Their primary conclusions were that specialisedorganisations and institutions often have a higher selling value than banks and other financial services companies. As a result, the advantages of the economies of scope might not be sufficient to enable the majority of banks in the USA and Europe to operate at their best.

Kirkpatrick, Murinde, and Tefula (2014) conducted an empirical research from 2001 to 2014 with 89 commercial banks from several African nations. According to the study's findings, banks typically have a profit efficiency of 65% and a cost efficiency of 80% when it comes to the DFA and SFA merits. According to Orlitzky's (2013) study, the increase in foreign bank penetration in Africa has resulted in a rise in foreign bank debt, which has negatively impacted the earnings and efficiency of most African banks.In conclusion, it can be claimed that domestic banking in Africa performs better than foreign entrants when it comes to management. The scenario in Nigeria is the same. Over the last ten years, there have been significant changes in the costs of financial assets held by Nigeria's banking sector. Both internal and external variables have had a significant impact on the quantity of loans granted by banks.The Central Bank Report (2016) states that as of December 2008 and December 2011, respectively, the percentage of gross advances to total industrial assets is 57% and 55%. The endeavour to raise the number of non-performing assets is the largest difficulty facing the majority of Kenyan commercial banks. This is primarily because the aforementioned assets must be included in any financial institution's income or they may be written off, which has a significant effect on the banking industry's overall performance.A robust banking industry is defined by its resilience to unfavourable economic shocks and its capacity to support the stability of the whole financial system as well as the overall economy (Business intelligence 2014).

Various authors have approached the complete spectrum of CRS from various perspectives. According to the Nigeria Social Enterprise Reports (2012), corporate social responsibility (CSR) refers to how a business integrates or balances the demands of the social, environmental, and economic spheres while also attending to its stakeholders and shareholders. This definition implies that corporate social responsibility (CSR) is typically seen as the contributions that companies make to sustainable development, which is defined as development that satisfies present demands without jeopardising the ability of future generations to satiate their own.From the preceding, it can be seen that corporate social responsibility (CSR) is a crucial idea for modern firms, particularly for managers who must make decisions that have an indirect or direct impact on their intermediate and macro environments. Therefore, it is reasonable to say that continuing to pay attention to their surroundings is one of the many strategies Nigerian banks may use to survive their business climate. Of course, students must consider more than just their surroundings; they must also consider how these activities impact their performance (Ofori et al., 2014). Stated differently, commercial organisationsmust find a way to combine their survival needs with their obligations to their host communities. It is based on this background that the present study seeks to determine the impact of corporate social responsibilityon task performance of commercial bank in portharcourt, Nigeria.

1. Statement of the problem

In Nigeria, the topic of corporate social responsibility (CSR) and banks has gained attention due to the fact that banks' annual reports always include a disclosure of their CSR spending. Every company wants to increase its market share, according to Folajin et al. (2014). To do this, it must earn more for each portion of the market, accumulate huge gross earnings by increasing total assets, and increase profit after taxes. In one way or another, all of these will lead to better financial success, which inevitably brings about higher levels of growth, employee happiness, customer pleasure, and environmental satisfaction through CSR.Environmental satisfaction may occasionally grow to be such a significant expenditure source that it hinders the success of the company. The majority of Nigerian businesses are hosted by host communities; therefore, in the name of corporate social responsibility (CSR), banks frequently impose conditions on these companies that require them to cede some ownership rights. These conditions, which include percentages for hiring native workers and royalties for long-term employment, among other things, can become significant sources of expense for these banks because they inevitably lower their earnings per share.Similar to this, CSR activities are not always predictable. For example, certain events, such as epidemics or natural disasters, frequently prompt CSR activities. Because the banks are not always prepared for these circumstances, the costs associated with these activities can occasionally become too onerous for them, which significantly lowers their gross earnings. Additionally, banks may find themselves compelled to give up part of their assets or supply their host towns with necessities like water and power. This might occasionally involve giving up their machines, which would reduce their overall assets. Lastly, as CSR initiatives are frequently funded by operating profits, this implies that CSR initiatives frequently result in lower bank profit after taxes. The aforementioned conditions might either be a source of growth or a hindrance to Nigerian banks' financial success. It is against these backdrops that this study was conducted to explore the effect of CSR activities on the financial performance of commercial banks in Port Harcourt, Nigeria.

1. Objectives of the Study

The main objective of this study is to examine the corporate social responsibility and task performance of commercial bank in portharcourt, Nigeria. Specific objectives of the study include;

1. To determine the impact of corporate social responsibility on  task performance of commercial bank in portharcourt, Nigeria
2. To identify the factors that mitigate the corporate social responsibility of commercial bank in portharcourt, Nigeria
3. To ascertain the relationship between corporate social responsibility and  task performance of commercial bank in portharcourt, Nigeria
4. To identify ways of improving he practices of corporate social responsibility of commercial bank in portharcourt, Nigeria

Research Questions

The following questions guided this study;

1. What is the impact of corporate social responsibility on  task performance of commercial bank in portharcourt, Nigeria?
2. What are the factors that mitigate the corporate social responsibility of commercial bank in portharcourt, Nigeria?
3. What is the relationship between corporate social responsibility and  task performance of commercial bank in portharcourt, Nigeria?
4. What are the ways of improving he practices of corporate social responsibility of commercial bank in portharcourt, Nigeria?

Research Hypotheses

The following is hypothesized;

Hypothesis One

H0: There is no significant impact of corporate social responsibility on task performance of commercial bank in portharcourt, Nigeria

H1: There is a significant impact of corporate social responsibility on task performance of commercial bank in portharcourt, Nigeria

Hypothesis Two

H0: There is no significant relationship between corporate social responsibility and task performance of commercial bank in portharcourt, Nigeria

H1: There is a significant relationship between corporate social responsibility and task performance of commercial bank in portharcourt, Nigeria

1. Significance of the Study

The benefits of the research are quite enormous, particularly to the banks in Nigeria. This is basically because the research will serve as a template for the owners and managers of these banks, to use as one of their best strategies for tackling issues concerning their CSR activities.

The findings of study  will also highlight grey areas for these banks on how to effectively allocate resources to their CSR activities. For the host communities also, this research will serve as a guild to understanding the in tricks of CSR and how they can achieve these without bankrupting their guess businesses.

The findings of this  research will also be literature for students for further studies and as well as contribution to the already existing knowledge on CSR, an addition of the Nigerian perspective as it regards CSR in banks.

Finally, the findings of this research is a source of personal improvement and enhancement, as it is slated to earn the researcher a Bachelors’ degree in Business Administration.

1. Scope of the Study

This study is limited to the impact of corporate social responsibility on task performance of commercial bank in Portharcourt, Nigeria. Participants for this study consisted of employees from five commercial banks (Access Bank, Zenith Bank, United Bank of Africa, Union Bank and Fidelity Bank) in Port Harcourt.

1. Operational Definition of Terms

Corporate Social Responsibility:  Corporate social responsibilitydefined as duties performed by organizations to the society in which they are operating, such as protection of the environment, provision of social amenities, health and safety, and so on.

Firm Performance: Firm performance is a fusion of an organization’s financial health, its ability and willingness to meet its long-term financial obligations and its commitments to provide services in the foreseeable future.