Nagy Zoltán Péter, guest lecturer at Professor Katalin Tardos’ CSR and Sustainability module
What is the relation between profit and CSR? Are profitable companies able to spend more on CSR due to their bigger profit, or their profit actually grows because they have an appropriate CSR management? The answer is far from obvious, as the marketing leader of the Hungarian bank OTP, Nagy Zoltán Péter explained.
Banks are not exceptions, and like other companies, they can work really efficiently if they can show their engagemnet to society, and make their positive commitment clearly visible to society. It will pay off to be ethical, in the long run definitely so. OTP has an interesting history, being the first Hungarian socialist bank after the Second World War, enjoying a monopolistic situation for long decades under socialism. After 1989, the question for the bank was how to change and how to survive in a true market situation, enter a competitive scene. OTP was not only a survivor but also a very successful one. OTP is the biggest commercial bank in Hungary, and now it has branches in 9 countries.
Being in a monopolistic situation for long, OTP did not really have to think much about corporate responsibility. Now, it is an absolute must, something that the bank should consider and cannot avoid. It is another issue though what Hungarian people think of corporate responsibility and how sceptic they are about it.
The first thing that comes to people’s mind when they think about CSR is donation, although it is the least effective. So, what are the true benefits of CSR reputation? Here they are: having value-conscious customers, innovation capability, employees’ loyalty, engagement in work, decreasing turnover in the workplace, higher employee satisfaction, good reputation of the bank, customers’ loyalty, and cost effectiveness. Being ethical will pay off, so it can be considered an investment decision.