Indian Film And Entertainment Industry Media Essay

Indian Film And Entertainment Industry Media Essay This report is part of the MBA sem 3 and 4 curriculum. Under which 2 students in one group are supposed to study one industry and so we have selected Film Industry for our study. The Indian film and entertainment industry, position at more than $8 billion, is one of the greatest increasing sectors of the Indian economy. Indian film industry forms the most key segment of entertainment sector. Indian film industry helps a lot in enlargement of entertainment industry the growth of country, at large. India has the worlds key movie industry in terms of the number of films produced. It is an enormous segment for foreign investment by corporatized entertainment companies. The demand for films in India deeply affected by the social, political, legal, technological etc. we also include how different environment affect film industry. In this report we also include key issues as well as current challenges of Indian film industry. Film Industry has increased significantly as a result of change from single producer to multiple production houses and according to sources even underworld plays vital role in producing films. Attitude of the film makers and audience has also changed over the years. In this project we show the list of film producing companies and name of top ten companies on the basis of its market share. Yash raj films have highest market share in Indian film industry; Aamir Khan Productions is 2nd highest market share in Indian film industry, and Red Chillies Entertainment 3rd highest market share in Indian film industry. The above three film producing houses are the major players in Indian film industry by having key market share in India. GROWTH AND EVOLUTION OF TOURISM INDUSTRY IN INDIA Hindi Film is the key part of the Indian film industry. It is used to refer the Hindi film industry in India. The term is often misunderstood as the whole of Indian cinema but it is only a part of the Indian film industry. Hindi Film Industry is the largest film producer in India and one of the largest in the world. Hindi Film Industry is one the most recognized film industry in the world with reach in diverse regions like Britain, U.S, Japan, Nepal, Canada and various parts of the world. The Raja Harishchandra was 1st silent movie prepared in India. In 1920 approximately 30 films were prepared by Indian film industry, while this number increases to approximately 200 films in 1930. In 21st century approximately 100 films are being prepared yearly by the Indian film industry. In 1940s Indian film industries have artists like Dilip Kumar Prithviraj Kapoor. This period is pre-independent India. In this era many filmmakers made patriotic films. In 1950s era was conquered by big and memorable artists like Ashok Kumar Raj Kapoor, Dev Anand, Guru Dut Meena Kumari. During this era humour also started making its way in the Film Industry as Kishore Kumars Chalti Ka Naam Gadi. In 1957, Mother India became the leading Indian movie to accomplish the Oscars in the top overseas Film category. In 1960s urban India was left in the wake of India being looked upon as a growing nation. Development of law order in the nation was the need of the hour thus films like Kanoon Kala Bazaar dealt with this subject. In 1970s decade was mostly dominated by artists like Amitabh Bachchan, Rajesh Khanna, Jaya Bhaduri, Hema Malini, Manoj Kumar. Films like Mera Naam Joker, Seeta Aur Geeta, Aur Paschim Anand are a few of the most important films of this era. It was in this period that Amitabh Bachchan got the title of Angry Young Man of Indian film industry. This era also saw the western influence on the Indian society with films like Purab Aur Paschim. In 1980s during this decade the impression of Angry Young Man continued as plenty of films were prepared showing one man aggressive against the injustices of the society. This era also saw some other enormous artists like sridevi, Madhuri dixit, Anil Kapoor, Aamir khan, Rishi Kapoor, Vinod khanna, salman khan. Films in this era are Namkeen, namak Halal, Chasme baddoor, The Burning Train Mr India. In 1990s this decade with bits and pieces of comedy films, war films and films based on life in underworld contributing to the victory of many artists. Salman khan, Shahrukh Khan, Kajol Priety Zinta, Akshay Kumar conquered the Hindi Film Industry in this decade. In 2000s entry of Hrithik Roshan, Aishwariya Rai, Abhishek Bachchan, sonam Kapoor Ranbir Kapoor continues as this decade is coming to an end. This decade saw lots of films being made on issues of terrorism. Films like Monsoon Wedding and Bollywood Hollywood appealed the NRI audience who are increasing in numbers day by day. Thus a new concept of Hinglish cinema became popular among the young generation. Films like Lage Raho Munnabhai, Lagaan, Gadar Ek Prem Katha, Dil Chahta Hai, Devdas, Taare Zameen Par, Ghajini are some of the memorable movies of this decade. This decade would be remembered for A.R. Rehman who received an Oscar in the early2009. PRODUCT PROFILE 3D films Television Amateur Films   Artists film and video   Animation Films Corporate and Promotional Films   Documentaries  Films Fiction Films Educational Films  Ã‚   Political and Campaigning Films   3D films 3D  is  motion picture  that enhances the  reality  of  deepness view. Resulting from  stereoscopic  shooting, a normal motion picture camera system is used to trace the photos as seen from 2 perspectives unique projection hardware eyewear are used to present the reality of deepness when viewing the film. Chota Chetan was the 1st Indian 3D film. The movie was made in 1984. Chota Chetan was a massive box office achievement and earned approximately Rs 60 crore in 1984-85. The film also wins the Presidents Gold Medal. Television A number of the collections collect local and national television broadcast material. This can contain original film and video master objects as well as off-air tape recordings of the programmes as they were relay. Amateur films This type of film generally shot on  16 mm film  until the arrival of cheap  cameras. The introduction of  digital computer based editing significantly extended the technical value achievable by the low-budget filmmaker. Artists film and video Since the early on days, artists film-makers have used the moving image to discover places, ideas, and the nature of the moving image itself by using both new traditional techniques. Animation Films Animation  is the quick display of a cycle of images to make a  reality  of progress. The mainly ordinary way of presenting animation is as a video, though there are other ways. This kind of appearance is typically accomplished with projector, camera and computer screens which can quickly rotation through images in a chain Corporate and Promotional Films   Corporate video  creation refers to  corporate communications  objects specially made for a use by a corporation, company organization. A corporate video is frequently planned for a definite reason in a corporate viewed only by targeted viewers. Documentary films Documentary films  represent a large variety of  non fictional  movement pictures  planned to  document  a few part of truth, mostly for the purposes of education historical record. Fictional Film Fictional film  is a film that tells an  imaginary story or occasion. In this manner of pictures, realistic narratives and characters facilitate influence the audience that the relating invented story is real. Educational film An  educational film  is a  film whose main reason is to  inform. Educational films have been used in many kinds of teaching method. Political and Campaigning Films Lots of political organizations have used the film and videos to support their foundation. Films comprise images of demonstrations mutually regionally and nationwide, as well as films issues such as war housing from the viewpoint of exacting political groups. DEMAND DETERMINATION OF THE INDUSTRY The common determinants demand are, prices of a substitute, prices of a complementary, Utility from it, ability to pay, Price of a goods etc. The demand determinations of film industry are as follows Individual factors It includes consumption patterns experiential motivation Films are experimental goods that customers engage in for enjoyment and fun which means that hedonic worth is the key object for the film know-how, whereas practical motives play an additional role. Thus active viewers consume films for aim-directed purpose. For some people, movement movies are more than just one more form of entertainment through which one can spend in the company of friends. Elements such as the market share of India and domestic films, the top ten box-office admissions and the per capita admissions may give us with an general image of the individuals preference in the demand for a certain kind of film. Industry-related factors It includes marketing production distribution. Marketing Value can simply be evaluated in terms of the spending experience, constant information regarding a film is obtainable prior to procure, the quality of movies can be assessed by customers simply when watching them. While box-office information responds to a mixture of motivation and wider promotion, we also require understanding the choice of a certain film over one more. For observed products, such as films, customers search for two kinds of information: observed and non-observed sources, television advertisement are experiential sources; they give a possibility to attempt the movie. Friends who have seen the movie can explain it and are hence another observed basis. Production The market achievement of film can be estimated to be influenced by the customers appraisal of a film worth. Worth, however, is hard to determine prior to viewing, consequently, audiences can understand production budgets as signals of a film high worth. Distribution Indian film producers were the primary to descend endogenous expenses into large-scale promotion distribution which meant that Bollywood became and has remained relatively more capable at serving mass markets than movie clusters in extra large movie producing countries. Cultural Social factors It includes social cultural status, occupation and Education Social factors such as earnings, education, and profession are probable to comprise significant predictors of the demand for a definite type of films. With value to our conceptualization of movies demand, we rely on the common proposition that little cultural capital customers favor entertainment that is fewer demanding in the difficulties it poses, while the taste of customers with superior cultural wealth. PLAYERS IN THE INDUSTRY Company market share (in %) Yash Raj Films 36 Aamir Khan Productions 16 Red Chillies Entertainment 12 Dharma Productions 4 UTV Motion Pictures 4 Reliance Entertainment 3 Eros International 3 T-Series 3 Vinod Chopra Productions 2 Vishesh Films 1 Yash Raj Films Yash Raj Films is an Indian film company established by Yash Chopra, an Indian film director and filmmaker who was considered a movie mogul in country. Yash chopra is son of Aditya Chopra also made films under the banner of yash raj films. Aamir Khan Productions Aamir Khan Productions was established in 1999 by film actor Aamir Khan with the purpose of making the movie Lagaan. The film was released in 2001. The movie was together a key critical and commercial achievement, and was chosen for the 74th Academy Awards in the greatest Foreign Language movie class. Red Chillies Entertainment RCE is an Indian motion picture making and supply company, located in Mumbai. The company was established in 2004 by film actor Gauri Khan Shahrukh Khan. Dharma Productions Dharma Productions PLtd. is an Indian motion picture making and supply company, located in Mumbai. The company was established by Yash Johar in 1976. It is now running by his son Karan Johar subsequent to the death of the yash johar in 2004 UTV Motion Pictures UTV Motion Pictures is a completely owned supplementary of UTV Software Communications Ltd., located in London films and entertainment making company. Reliance Entertainment Reliance Entertainment also known as Reliance BIG Entertainment and entirely owned subsidiary of the Anil Dhirubhai Ambani Group conduct its film and entertainment industry. Eros International Eros International is an Indian motion picture making and supply company, located in Mumbai. The company was established by Ramraj Nahta in 1977. It is a top worldwide corporation in the Indian film entertainment industry. Other players are Vinod Chopra Productions, T-Series , Vishesh Films, Excel Entertainment, Balaji Motion Pictures, Shree Ashtavinayak Cine Vision Ltd, Illuminati Films, Prakash Jha Productions, Fox Star Studios, Nadiadwala Grandson Entertainment, Filmkraft Productions, Ashutosh Gowariker Productions, Vishal Bhardwaj Pictures KEY ISSUES AND CURRENT TRENDS Indian film industry over the earlier few years has been open towards foreign investments. This has cemented way for lots of international production firms to construct their entrance in Bollywood along with chance their offices in the India. As per FICC report, Indian movie industry is value $ 2.11 billion and is probable to observer a 9.1 percent growth till 2013. Worlds major film business in terms of making volume is undergoing a enormous international company with Reliance ADA Group signing a production deal with DreamWorks Studios, authorized by Steven Speilberg, a glowing Hollywood director, to create movies with the preliminary venture of US$ 825 million. Subsequent the lines, Yash Raj Films have signed joint partnerships with Walt Disney, to make animated movies. S. Leela Bansali Films partnership with Sony Pictures Entertainment and TV 18 association with Viacom to form Viacom-18. Adlabs has emerged as the only film chain in India given that 3D and 6D formats and PVR is all set to impart approximately $ 52.2 million to raise its film creation and bowling operation in India. RECENT CHALLENGES India has the worlds major film industry in terms of the quantity of movies produced 1000 films yearly, frequently in the Hindi language. Nowadays, the technology of movie-making in India is possibly the best among all developing nations while the films themselves stay typically repetitive in story line and comfortable. The financing outline, centered on distributors, is supposed to have distorted since the 1960s when the studio classification collapsed and self-employed performers emerged. This gave grow to the star system in which actor ceased to have lasting contractual obligations towards any film manufacture. Relatively, they began to work as freelancers unassailable fees in part to the box office performance of their new films. This enlarged costs of film production since the extra successful actors hogged key proportions of the producers funds. Film production consequently became a risky business and the affiliation with various lenders strengthens more than the years. A low finances Hindi film can be completed for even as low as Rs. 15 million. A big finances movie can cost in surplus of $30 million. India has a National Film Development Corporation which investments some of films. NFDC cannot be measured to play a vital role in the film industry since it finances else few movies which, too, are not of the kind that has prepared the Indian film industry so exciting. PESTLE ANALYSIS POLITICAL ANALYSIS Factors are how a government intervenes in the nation. Particularly, political factors comprise labour law, tax policy, environmental policy, trade boundaries, tariffs, political constancy. Government Support With compared to governments in other nations efforts by the government of India to encourage the film industry have been very nominal. Government Initiatives A SEZ is going to be constructed in Thiruvananthapuram exclusively for the film animation industry. The Film Video Park made an excellent start when the Chennai-based Prasad Labs has made it its base to development every Malayalam movies for the subsequently two years. The government cans supplementary support investments participation in the film industry by providing tax benefits. ECONOMIC ANALYSIS Factors comprise economic enlargement, exchange rates, interest rate inflation rates. These factors have key impacts on how businesses work and formulate decisions. Indias benefit in low costs has been exploited by lots of multinational production studios. The arrival of digital film coincided with the liberalization of the Indian economy and India open the remuneration of lower production costs, strong innovative and scientific skills and a large English talking people. This has led to the growth of state of the films art in some Indian cities by the way of collaborating with international entertainment companies. Indian film making firms cannot match their western counterparts in financial power. It is pointed out that state help in the form of tax holidays is crucial for success in the film making business. SOCIAL ANALYSIS Factors comprise the cultural aspects contain health awareness, population expansion rate, age allocation and safety. There is huge demand from this part of Indian population for a new medium that facilitate information communication sharing, while at the similar time, being simply available to the masses via the TV. Products of interactive medium and film can plug this demand gap to a huge degree; they can be vast tools for education, awareness entertainment between rural and urban areas illiterates in India. India can contribute in a more major way in the international films market, provided the country has built up essential manpower, with the related know-how, to fuel its growth. India has the probable to grow its film industry to approximately $ 1 billion in 2010, but will remain limited to $ 869 million on description of a scary demand-supply gap in the area of employable resources. TECHNOLOGICAL ANALYSIS Factors comprise environmental ecological aspects, such as RD, computerization, new technology and the velocity of technological alteration. Indias film industry is growing at an amazing speed, the fact remains that this increases is mainly a result of the growing of studios for hire. The film industry is still youthful. The booming film outsourcing industry is continually demanding new skills new infusion of talent into the industry. Education in latest media has to be embedded into the normal curriculum. Students have to understand that they can have a profitable career as film maker or actor, the governments as well as institutions have to establish programmes for their career progress. LEGAL ANALYSIS Factors comprise prejudice law, consumer law, employment law, antitrust law, safety law. Outsourcers have forever been afraid with the defense of their intellectual property in India. India is unsuccessful to take several actions against its violation. India needs to reinforce its intellectual property policy ensure that companies working in the outsourcing area take strict steps to take care of client intellectual property rights. ENVIRONMENTAL ANALYSIS Factors comprise climate, weather its change, which may particularly influence industries such as farming, tourism, insurance. Furthermore, rising consciousness to climate change is affecting how companies works products they offer. Indian firms are facing a talent scarcity which influences their capacity to degree up their operations based on client demand. This also affects the client assurance in off shoring large chunks of work. Though Indian companies have set in place vast expansion tactics, these are often flawed by different reasons. Tie-ups with educational institutes are serving overcome this complexity.

O.B Case Studies

|VALUES, ATTITUDES, AND JOB SATISFACTION | LEARNING OBJECTIVES After studying this chapter, students should be able to: 1. Contrast terminal and instrumental values 2. List the dominant values in today’s workforce 3. Identify the five value dimensions of national culture 4. Contrast the three components of an attitude 5. Summarize the relationship between attitudes and behavior 6. Identify the role that consistency plays in attitudes 7. State the relationship between job satisfaction and behavior 8.Identify four employee responses to dissatisfaction CHAPTER OVERVIEW Why is it important to know an individual’s values? Although they do not have a direct impact on behavior, values strongly influence a person’s attitudes. Knowledge of an individual’s value system can provide insight into his/her attitudes. Given that people’s values differ, managers can use the Rokeach Value Survey to assess potential employees and determine if their values align with the dominant values of the organization. An employee’s performance and satisfaction are likely to be higher if his/her values fit well with the organization.For instance, the person who places high importance on imagination, independence, and freedom is likely to be poorly matched with an organization that seeks conformity from its employees. Managers are more likely to appreciate, evaluate positively, and allocate rewards to employees who â€Å"fit in,† and employees are more likely to be satisfied if they perceive that they do fit. This argues for management to strive during the selection of new employees to find job candidates who not only have the ability, experience, and motivation to perform, but also a value system that is ompatible with the organization’s. Managers should be interested in their employees’ attitudes because attitudes give warnings of potential problems and because they influence behavior. Satisfied and committed employees, for inst ance, have lower rates of turnover and absenteeism. Given that managers want to keep resignations and absences down—especially among their more productive employees—they will want to do those things that will generate positive job attitudes.Managers should also be aware that employees will try to reduce cognitive dissonance. More importantly, dissonance can be managed. If employees are required to engage in activities that appear inconsistent to them or are at odds with their attitudes, the pressures to reduce the resulting dissonance are lessened when the employee perceives that the dissonance is externally imposed and is beyond his/her control or if the rewards are significant enough to offset the dissonance. WEB EXERCISESAt the end of each chapter of this instructor’s manual, you will find suggested exercises and ideas for researching the WWW on OB topics. The exercises â€Å"Exploring OB Topics on the Web† are set up so that you can simply photocopy t he pages, distribute them to your class, make assignments accordingly. You may want to assign the exercises as an out-of-class activity or as lab activities with your class. Within the lecture notes the graphic will note that there is a WWW activity to support this material.The chapter opens introducing Marge Savage, a Microsoft marketing analyst who is gathering information about the â€Å"Nexters† generation—people born after 1977. They are the first group of people to never know a world without computers and the Internet. She found that this group values integrity, teamwork, moral support, responsibility, and freedom to pursue their dreams. They want to work for a company that supports their needs, and where they can have significant influence in shaping society.They see technology and the Internet as a major force for changing the world—good news for Microsoft. CHAPTER OUTLINE |Values |Notes: | |Values represent basic convictions that â€Å"a specific mode of conduct or end-state of existence is personally or | | |socially preferable to an opposite or converse mode of conduct or end-state of existence. | | | | | |There is a judgmental element of what is right, good, or desirable. | | | | | |Values have both content and intensity attributes. | | | | |The content attribute says that a mode of conduct or end-state of existence is important. | | |The intensity attribute specifies how important it is. | | |Ranking an individual’s values in terms of their intensity equals that person’s value system. | | | | |Values are not generally fluid and flexible. They tend to be relatively stable and enduring. | | | | | |A significant portion of the values we hold is established in our early years—from parents, teachers, friends, | | |and others. | |The process of questioning our values, of course, may result in a change, but more often, our questioning acts | | |to reinforce the values we hold. | | |A. Importance of Values | | |1.Values lay the foundation for the understanding of attitudes and motivation because they influence our | | |perceptions. | | | | | |2. Individuals enter organizations with notions of what is right and wrong with which they interpret behaviors| | |or outcomes—at times this can cloud objectivity and rationality. | | | | |3. Values generally influence attitudes and behavior. | | |B. Types of Values | | |1.Rokeach Value Survey (Exhibit 3-1) | | | | | |It consists of two sets of values, with each set containing 18 individual value items. | | |One set—terminal values—refers to desirable end-states of existence, the goals that a person would like to | | |achieve during his/her lifetime. | |The other—instrumental values—refers to preferable modes of behavior, or means of achieving the terminal values. | | | | | | | | |2. Several studies confirm that the RVS values vary among groups. | | | | |People in the same occupations or categories t end to hold similar values. | | |Contemporary Work Cohorts | | |1.The unique value of different cohorts is that the U. S. workforce can be segmented by the era they entered | | |the workforce. (Exhibit 3-3) | | |Contemporary Work Cohorts (cont. ) |Notes: | |2.Veterans—Workers who entered the workforce from the early 1940s through the early 1960s | | |Influenced by the Great Depression and World War II | | |Believe in hard work | | |Tend to be loyal to their employer | | |Terminal values: Comfortable life and family security | | | | | |3. Boomers—Employees who entered the workforce during the 1960s through the mid-1980s | | | | | |Influenced heavily by John F.Kennedy, the civil rights and feminist movements, the Beatles, the Vietnam War, | | |and baby-boom competition | | |Distrust authority, but have a high emphasis on achievement and material success | | |Organizations who employ them are vehicles for their careers | | |Terminal values: sense of accomplishment and social recognition | | | | | |4.Xers—began to enter the workforce from the mid-1980s | | | | | |Shaped by globalization, two-career parents, MTV, AIDS, and computers | | |Value flexibility, life options, and achievement of job satisfaction | | |Family and relationships are important and enjoy team-oriented work | | |Money is important, but will trade off for increased leisure time | | |Less willing to make personal sacrifices for employers than previous generations | | |Terminal values: true friendship, happiness, and pleasure | | | | | |5. Nexters—most recent entrants into the workforce. | | | | |Grew up in prosperous times, have high expectation, believe in themselves, and confident in their ability to | | |succeed | | |Never-ending search for ideal job; see nothing wrong with job-hopping | | |Seek financial success | | |Enjoy team work, but are highly self-reliant | | |Terminal values: freedom and comfortable life | | | | | |Individuals’ values dif fer, but tend to reflect the societal values of the period in which they grew up. This | | |can be a valuable aid in explaining and predicting behavior. Employees in their 60s, for instance, are more | | |likely to accept authority than coworkers 15 years younger. | | | | | |7. Workers under 35 are more likely than the other groups to balk at having to work overtime or weekends, | | |and are more prone to leave a job in mid-career to pursue another that provides more leisure time. | | | | OB IN THE NEWS – American Workers Rethink Priorities Values are relatively permanent, but dramatic shocks can realign them. For example, the terrorists’ attacks on September 11 may have significantly reprioritized many Americans’ values. The initial response to the terrorist attacks for many people was a reevaluation of choices related to jobs, family, and career success. In some cases, this led to a rethinking of career paths, cutting back on grueling schedules, and deciding to pursue work that might pay less but seem more meaningful.For instance, in California, young workers who once talked of dot-com millions are now asking: â€Å"Is it worth it? † Some employees appear less concerned about putting in face time, making deadlines, and getting on the fast track. They seem more concerned about family and worry less about time at the office. CEOs say some of their employees are talking more earnestly about work/life balance, mortality, and other questions once considered taboo in the office. Said one consultant, â€Å"The event de-emphasized what most people value—the money and the luxuries. People are questioning what’s really important; they’re questioning work. It’s happening across the board. † It has now been more than a year since the terrorist attacks on New York and Washington D. C.That provides a more meaningful perspective on whether this event has had long-term implications on workplace values, or whet her any reprioritizing was merely a knee-jerk reaction to a traumatic event, followed by a return to â€Å"business as usual. † Do you think a significant portion of Americans have permanently reprioritized their values as a result of 9-11? Class Exercise: 1. Have students break into small groups to discuss the question: â€Å"Do you think a significant portion of Americans have permanently reprioritized their values as a result of 9-11? † Ask them to list examples of why or why not they think the way they do. 2. As a class, share what was discussed in the small groups. 3. Ask if they think America’s values have changed, or were they just reawakened? 4.Ask if they think organizations’ values have changed or reprioritized as a result of the events. 5. Ask them to relate this question to themselves. Have they reprioritized their lives as a result of the 9-11 events? (They may not want to share this information with the entire class—its purpose is jus t to get them thinking. ) |A. Values, Loyalty, and Ethical Behavior |Notes: | |Many people think there has been a decline in business ethics since the late 1970s. The four-stage model of | | |work cohort values might explain this perception. Exhibit 3-2) | | | | | |Managers consistently report the action of bosses as the most important factor influencing ethical and unethical| | |behavior in the organization. | | | | | |Through the mid-1970s, the managerial ranks were dominated by Veterans whose loyalty was to their employer; | | |their decisions were made in terms of what was best for the employer. | | | | |Boomers entered the workforce at this time and by the 1990’s had risen into the majority of management | | |positions. Loyalty was to their careers. Self-centered values would be consistent with a decline in ethical | | |values. Did this really happen? | | | | | |Recent entrants to the workforce—Xers—are now moving into middle management. Loyalty is to relationships, | | |therefore they may be more likely to consider the ethical implications of their actions on others around them. | |Instructor Note: At this point in the lecture you may want to introduce the Ethical Dilemma: Is it a Bribe or a Gift? Exercise found in the text. The purpose of the exercise is to provide the opportunity for students to understand that ethical situations are not always black or white and must be given consideration as business decisions are made. |B. Values Across Cultures |Notes: | |Values differ across cultures, therefore, understanding these differences helps to explain and to predict | | |behavior of employees from different countries.One of the most widely referenced approaches for analyzing | | |variations among cultures has been done by Geert Hofstede. | | | | | |Hofstede’s A framework for assessing cultures; five value dimensions of national culture (Exhibit 3-4): | | | | | |a.Power distance: | | | | | |The degree to which people i n a country accept that power in institutions and organizations is distributed | | |unequally. | | | | | |Individualism versus collectivism: | | | | |Individualism is the degree to which people in a country prefer to act as individuals rather than as members of | | |groups. | | |Collectivism equals low individualism. | | | | | |Quantity of life versus quality of life: | | | | | |Quantity of life is the degree to which values such as assertiveness, the acquisition of money and material | | |goods, and competition prevail. | |Quality of life is the degree to which people value relationships and show sensitivity and concern for the | | |welfare of others. | | | | | |Uncertainty avoidance: | | | | | |The degree to which people in a country prefer structured over unstructured situations. | | | | |Long-term versus short-term orientation: | | | | | |Long-term orientations look to the future and value thrift and persistence. | | |Short-term orientation values the past and present and emphasizes respect for tradition and fulfilling social | | |obligations. | | | | |Conclusions: | | | | | |Asian countries were more collectivist than individualistic. US ranked highest on individualism. German and | | |Hong Kong ranked highest on quality of life; Russia and The Netherlands were low. China and Hong Kong had a | | |long-term orientation; France and US were low. | | | | |3. Hofstede’s work is the basic framework for assessing cultures. However, it is nearly 30 years old. In | | |1993, the Global Leadership and Organizational Behavior Effectiveness (GLOBE) has begun updating this research | | |with date from 825 organizations and 62 countries. | | | | | |a.GLOBE Framework for Assessing Cultures: | | | | | |Assertiveness: The extent to which a society encourages people to be tough, confrontational, assertive, and | | |competitive versus modest and tender | | | | |Future Orientation: The extent to which a society encourages and rewards future-oriented b ehaviors such as | | |planning, investing in the future and delaying gratification | | | | | |Gender differentiation: The extent to which a society maximized gender role differences | | |Values Across Cultures (cont. |Notes: | | | | |Uncertainly avoidance: Society’s reliance on social norms and procedures to alleviate the unpredictability of | | |future events | | | | | |Power distance: The degree to which members of a society expect power to be unequally shared | | | | | |Individualism/Collectivism: The degree to which individuals are encouraged by societal institutions to be | | |integrated into groups within organizations and society | | | | | |In-group collectivism: The extent to which society’s members take pride in membership in small groups such as | | |their families and circles of close friends, and the organizations where they are employed | | | | | Performance orientation: The degree to which society encourages and rewards group members for performance | | |improvement and excellence | | | | | |Humane orientation: The degree to which a society encourages and rewards individuals for being fair, | | |altruistic, generous, caring, and kind to others | | | | | |b. Conclusion: The GLOBE study had extended Hofstede’s work rather than replaced it. It confirms Hofstede’s | | |five dimensions are still valid and provides updated measures of where countries are on each dimension. For | | |example, the U. S. in the 70s led the world in individualism—today, it is in the mid-ranks of countries. | |Instructor Note: At this point in the lecture you may want to introduce the Team Exercise: Challenges in Negotiating with Chinese Executives found in the text. The purpose of this exercise is to give the students an opportunity to develop awareness of how to effectively work with another culture when doing business. |C. Implications for OB | | |Americans have developed organizational behavior within domestic contexts—mor e than 80 percent of the articles | | |published in journals were by Americans. | | | | |Follow-up studies continue to confirm the lack of cross-cultural considerations in management and OB research. | | |From a cultural perspective this means: | | | | | |Not all OB theories and concepts are universally applicable. | |You should take into consideration cultural values when trying to understand the behavior of people in different| | |countries. | | |Attitudes | | |Attitudes are evaluative statements that are either favorable or unfavorable concerning objects, people, or | | |events. | | | | | |Attitudes are not the same as values, but the two are interrelated. | | | | |Three components of an attitude: | | | | | |Cognition | | |Affect | | |Behavior | | | | |The belief that â€Å"discrimination is wrong† is a value statement and an example of the cognitive component of an | | |attitude. | | |Attitudes (cont. ) |Notes: | |Value statements set the stage for the more critical part of an attitude—its affective component. Affect is the | | |emotional or feeling segment of an attitude. Example: â€Å"I don’t like Jon because he discriminates again | | |minorities. | | | | | |The behavioral component of an attitude refers to an intention to behave in a certain way toward someone or | | |something. Example: â€Å"I chose to avoid Jon because he discriminates. † | | | | | |Viewing attitudes as made up of three components helps with understanding of the potential relationship between | | |attitudes and behavior, however, when we refer to attitude essentially we mean the affect part of the three | | |components. | | | | |In contrast to values, your attitudes are less stable. Advertisements are directed at changing your attitudes | | |and are often successful. | | | | | |In organizations, attitudes are important because they affect job behavior. | | |A. Types of Attitudes | | |OB focuses our attention on a very limited number o f job-related attitudes.Most of the research in OB has been |Notes: | |concerned with three attitudes: job satisfaction, job involvement, and organizational commitment. | | | | | |Job satisfaction | | | | | |Definition: It is an individual’s general attitude toward his/her job. | | | | |A high level of job satisfaction equals positive attitudes toward the job and vice versa. | | | | | |Employee attitudes and job satisfaction are frequently used interchangeably. | | | | | |Often when people speak of â€Å"employee attitudes† they mean â€Å"employee job satisfaction. | | | | | |Job involvement | | | | | |A workable definition: the measure of the degree to which a person identifies psychologically with his/her job | | |and considers his/her perceived performance level important to self-worth. | | | | | |High levels of job involvement is thought to result in fewer absences and lower resignation rates. | | | | | |Job involvement more consistently predicts turnover than absenteeism. | | | | |Organizational commitment | | | | | |Definition: A state in which an employee identifies with a particular organization and its goals, and wishes to| | |maintain membership in the organization. | | | | |Research evidence demonstrates negative relationships between organizational commitment and both absenteeism and| | |turnover. | | | | | |An individual’s level of organizational commitment is a better indicator of turnover than the far more | | |frequently used job satisfaction predictor because it is a more global and enduring response to the organization| | |as a whole than is job satisfaction. | | | | |This evidence, most of which is more than two decades old, needs to be qualified to reflect the changing | | |employee-employer relationship. | | |A. Types of Attitudes (cont. ) |Notes: | |Organizational commitment is probably less important as a job-related attitude than it once was because the | | |unwritten â€Å"loyalty† contract i n place when this research was conducted is no longer in place. | | | | |In its place, we might expect â€Å"occupational commitment† to become a more relevant variable because it better | | |reflects today’s fluid workforce. | | Instructor Note: At this point in the lecture you may want to introduce the exercise Point-Counter Point: Mangers Can Create Satisfied Employees exercise found in the text. The purpose of the exercise is to replace popularly held notions with research-based conclusions. |B. Attitudes and Consistency |Notes: | |People sometimes change what they say so it does not contradict what they do. | | | | |Research has generally concluded that people seek consistency among their attitudes and between their attitudes | | |and their behavior. | | | | | |Individuals seek to reconcile divergent attitudes and align their attitudes and behavior so they appear rational| | |and consistent. | | | | |When there is an inconsistency, forces are initiated to return the individual to an equilibrium state where | | |attitudes and behavior are again consistent, by altering either the attitudes or the behavior, or by developing | | |a rationalization for the discrepancy. | | |C. Cognitive Dissonance Theory | | |Leon Festinger, in the late 1950s, proposed the theory of cognitive dissonance, seeking to explain the linkage | | |between attitudes and behavior. He argued that any form of inconsistency is uncomfortable and that individuals | | |will attempt to reduce the dissonance. | | | | |Dissonance means â€Å"an inconsistency. † | | | | | |Cognitive dissonance refers to â€Å"any incompatibility that an individual might perceive between two or more of | | |his/her attitudes, or between his/her behavior and attitudes. | | | | | |No individual can completely avoid dissonance. | | | | | |The desire to reduce dissonance would be determined by: | | | | | |The importance of the elements creating the dissonance. | | |The degree of infl uence the individual believes he/she has over the elements. | | |The rewards that may be involved in dissonance. | | | | |Importance: If the elements creating the dissonance are relatively unimportant, the pressure to correct this | | |imbalance will be low. | | | | | |Influence: If the dissonance is perceived as an uncontrollable result, they are less likely to be receptive to | | |attitude change. While dissonance exists, it can be rationalized and justified. | | | | |Rewards: The inherent tension in high dissonance tends to be reduced with high rewards. | | | | | |Moderating factors suggest that individuals will not necessarily move to reduce dissonance—or consistency. | | |C. Cognitive Dissonance Theory (cont. ) |Notes: | |Organizational implications | | | | |Greater predictability of the propensity to engage in attitude and behavioral change | | |The greater the dissonance—after it has been moderated by importance, choice, and rewards factors—the gr eater | | |the pressures to reduce it. | | |D. Measuring the A-B Relationship | | |Early research on attitudes and common sense assumed a causal relationship to behavior. In the late 1960s, this| | |assumed relationship between attitudes and behavior (A-B) was challenged. Recent research has demonstrated that| | |attitudes significantly predict future behavior. | | | | |The most powerful moderators: | | | | | |Importance | | |Specificity | | |Accessibility | | |Social pressures | | |Direct experience | | | | | |Importance: Reflects fundamental values, self-interest, or identification with individuals or groups that a | | |person values. | | | | | |Specificity: The more specific the attitude and the more specific the behavior, the stronger the link between | | |the two. | | | | |Accessibility: Attitudes that are easily remembered are more likely to predict behavior than attitudes that are | | |not accessible in memory. | | | | | |Social pressures: Discrepancies between att itudes and behavior are more likely to occur where social pressures | | |to behave in certain ways hold exceptional power. | | | | |Direct experience: The attitude-behavior relationship is likely to be much stronger if an attitude refers to an | | |individual’s direct personal experience. | | |E. Self-perception theory | | |Researchers have achieved still higher correlations by pursuing whether or not behavior influences attitudes. | | | | |Self-perception theory argues that attitudes are used to make sense out of an action that has already occurred | | |rather than devices that precede and guide action. Example: I’ve had this job for 10 years, no one has forced | | |me to stay, so I must like it! | | | | | |Contrary to cognitive dissonance theory, attitudes are just casual verbal statements; they tend to create | | |plausible answers for what has already occurred. | | | | |While the traditional attitude-behavior relationship is generally positive, the behavior- attitude relationship | | |is stronger particularly when attitudes are vague and ambiguous or little thought has been given to it | | |previously. | | |An Application: Attitude Surveys | | |The most popular method for getting information about employee attitudes is through attitude surveys. See | | |Exhibit 3-5) | | | | | |Using attitude surveys on a regular basis provides managers with valuable feedback on how employees perceive | | |their working conditions. Managers present the employee with set statements or questions to obtain specific | | |information. | | | | |Policies and practices that management views as objective and fair may be seen as inequitable by employees in | | |general or by certain groups of employees and can lead to negative attitudes about the job and the organization. | | | | | |Employee behaviors are often based on perceptions, not reality. Often employees do not have objective data from | | |which to base their perceptions. | | | | |The use of regular attitude surveys can alert management to potential problems and employees’ intentions early | | |so that action can be taken to prevent repercussions. | | |G. Attitudes and Workforce Diversity | | |A survey of U. S. organizations with 100 or more employees found that 47 percent or so of them sponsored some | | |sort of diversity training. | | | | |These diversity programs include a self-evaluation phase where people are pressed to examine themselves and to | | |confront ethnic and cultural stereotypes they might hold. This is followed by discussion with people from | | |diverse groups. | | | | | |Additional activities designed to change attitudes nclude arranging for people to do volunteer work in | | |community or social service centers in order to meet face to face with individuals and groups from diverse | | |backgrounds, and using exercises that let participants feel what it is like to be different. | | |Job Satisfaction | | |Measuring Job Satisfaction | | |Job satisfa ction is â€Å"an individual’s general attitude toward his/her job. | | | | | |Jobs require interaction with co-workers and bosses, following organizational rules and policies, meeting | | |performance standards, living with working conditions that are often less than ideal, and the like. This means | | |that an employee’s assessment of how satisfied or dissatisfied he or she is with his/her job is a complex | | |summation of a number of discrete job elements. | | | | |The two most widely used approaches are a single global rating and a summation score made up of a number of job | | |facets. | | | | | |a. The single global rating method is nothing more than asking individuals to respond to one question, such as| | |â€Å"All things considered, how satisfied are you with your job? | | |Measuring Job Satisfaction (cont. ) |Notes: | | A summation of job facets is more sophisticated: | | | | | |It identifies key elements in a job and asks for the employee’s feelings about each one ranked on a standardized| | |scale. | | | | |Typical factors that would be included are the nature of the work, supervision, present pay, promotion | | |opportunities, and relations with co-workers. | | | | | |Comparing these approaches, simplicity seems to work as well as complexity. Comparisons of one-question global | | |ratings with the summation-of-job-factors method indicate both are valid. | |How Satisfied Are People in Their Jobs? | | |Most people are satisfied with their jobs in the developed countries surveyed. | | | | | |However, there has been a decline in job satisfaction since the early 1990s. In the US nearly an eight percent | | |drop in the 90s. Surprisingly those last years were one’s of growth and economic expansion. | | | | |What factors might explain the decline despite growth: | | | | | |Increased productivity through heavier employee workloads and tighter deadlines | | |Employees feeling they have less control over thei r work | | | | | |While some segments of the market are more satisfied than others, they tend to be higher paid, higher skilled | | |jobs which gives workers more control and challenges. | | Instructor Note: At this point in the lecture you may want to introduce the exercise found in the MYTH OR SCIENCE: How Satisfied Are People in Their Jobs? box found in the text.The purpose of the exercise is to replace popularly held notions with research-based conclusions. MYTH OR SCIENCE? – â€Å"Happy Workers Are Productive Workers† This statement is generally false. The myth that â€Å"happy workers are productive workers† developed in the 1930s and 1940s, due to the Hawthorne studies at Western Electric. A careful review of the research indicates that, if there is a positive relationship between happiness (i. e. , satisfaction) and productivity, the correlations are low; no more than two percent of the variance in output can be accounted for by employee satisfaction. The evidence, however, is for the reverse—productive workers are likely to be happy workers.That is, productivity leads to satisfaction rather than the other way around. If the organization rewards productivity, these rewards, in turn, increase your level of satisfaction with the job. Class Exercise 1. Brainstorm with students about situations where they knew workers/employees were unhappy with the company or their jobs, but still did a reasonably good job. Perhaps have them share insights into their own feelings about their school, or a particular class they disliked but still tried very hard. 2. Discuss why someone who is unhappy with his/her job might work hard at it and do good work. 3. Why would someone who is happy with his/her job not perform at a higher level than the disgruntled worker? 4.Students should come to realize that most effort comes from internal drive, not external motivation. As a result, a highly internally motivated individual might perform well in any circumstance whereas his/her organizational environment would not positively affect a non-internally motivated individual. |C. The Effect of Job Satisfaction on Employee Performance |Notes: | |Managers’ interest in job satisfaction tends to center on its effect on employee performance. Much research has| | |been done on the impact of job satisfaction on employee productivity, absenteeism, and turnover. | | | | |Satisfaction and productivity:

Green Banking

Introduction: Deforestation, dissertation, flood, soil erosion, siltation, sedimentation, river bank erosion, increased evaporation, Co2 emissions, rising sea-level, displacement, cyclones, salinization, arsenic contamination are most burning word in the present world. And all words are related natural disaster and climate change. Because, climate change is the most complicated issue the world is facing. Across the globe there have been continuous endeavors to measure and mitigate the risk of climate change caused by human activity.Another name of this attempt is â€Å"Sustainable Development† to us. The process of sustainable development involves all sectors in the economy – Government, NGOs, corporate, citizens and, of course, the financial sector. Our beloved mother land Bangladesh is one most affected country by this climate change. And Bangladesh banking industry is ahead one step from other financial institutions for taking endeavors to measure and mitigate the ri sk of climate change caused by human and banking activity. This activity is familiar in banking industry with title of â€Å"Green Banking†. 1. Green Banking: Green banking in general refers to the efforts of the Banking sector to keep the environment green and to minimize greenhouse effects through rationalizing their strategies, policy, decisions and activities pertaining to banking service, business and in-house operational activities. Green banking may be seen as a component of the global initiative from Banks end to save environment. Green banks or environmentally responsible banks do not only improve their own standards but also affect socially responsible behavior of other business. 1. 2 Rational of the Study:The success of a program like BBA is determined by how successfully the student of this program implemented in the practical life, which they learned from the program. Universities take many steps to make bridge between the academic knowledge and actual business w orld event of BBA students. Bangladesh banking industry is ahead one step from other financial institutions for taking endeavors to measure and mitigate the risk of climate change caused by human and banking activity. In Bangladesh there are many banks to do Green Banking among our domestic banks.The world is now become globalize so we have to sustain in the competitive world. We must take the competitive advantage that’s why we cannot avoid the environment while doing business. That’s why I feel very much interest in Green Banking. And it has another importance to me that is implementation of my educational knowledge and theoretical knowledge to the practical. 1. 3. 2 Specific Objectives: 1. 3. 1 General Objective: 1. 3 Objective of the Study: The objectives of the report are in lies with the objective of Project work.The prime goal of Project work is to provide a theoretical and practical experience to the student and to generate an opportunity to match the theoretic al concepts with real life situation. As stated above to deal with these objectives this report has been primarily divided into two parts. The objectives are: The general objective of this report is to fulfill the partial requirements of the BBA program and making me competent to cope with corporate culture through observing the general banking and remove the gap between practical world and theoretical knowledge.The specific objectives of this report is to I. To get comprehensive knowledge on overall banking industry of Bangladesh. II. To gather comprehensive knowledge on banking functions. III. To get vast knowledge about Green Banking. IV. To learn the major areas and products of Green Banking. V. To learn initiatives for promoting green banking at home and abroad. VI. To identify Green Banking policy. VII. To identify the necessity of Green Banking for Banking Industry. VIII. To identify the steps of Bangladesh Bank for Green Banking. 1. 4 Scope of the Study:We know that Banglade sh is the most preferable playground to play with people life for natural disaster. Deforestation, dissertation, flood, soil erosion, siltation, sedimentation, river bank erosion, increased evaporation, Co2 emissions, rising sea-level, displacement, cyclones, salinization, arsenic contamination are most burning word in the present world. And all these words are related natural disaster and very suitable to accommodate in our country. That’s why, Green Banking open a new era for Bangladesh banking industry to create a positive image, increase market value and contribute for developing the country.In our country Banks’ are the major of welfare driven economy and promoter of balanced growth in a country like Bangladesh which has a poverty stricken contemporary economic background. So Banks’ have a great opportunity to implement their mission, objectives very easily through green banking. By adopting a comprehensive green banking policy, installing new green banking products, considering green banking strategies at time of loan disbursement, developing program for the clients, mass people, and stakeholders to create awareness among them about the environment a bank can easily practice green banking.Bangladesh Bank the central bank of Bangladesh is already placed an order on February 27, 2011for the banking industry. Dhaka Bank Ltd. , Shahjalal Islami Bank, Mutual Trust Bank Ltd. , AB Bank Ltd. , Al-Arafah Islami Bank Ltd. , National Bank Ltd. , Uttara Bank Ltd. , Rupali Bank Ltd. , Jamuna Bank Ltd. , Brac Bank Ltd. , United Commercial Bank Ltd. , Basic Bank Ltd. , along with Islami Bank Bangladesh Ltd. , are famous for practicing green banking in Bangladesh. It is obvious that every study has some limitations. The study I have made is of great importance and require me huge work.While conducting I had to face a number of problems, which called limitations of my report. Those limiting factors that hampered my smooth workings to prepare this rep ort are as follows: * Lack of time: The time period of this study is very short. We had some weeks in my hand to complete this report, which was not enough. So I could not go in depth of the study. * Insufficient data: There is a great lacking of numerical data about green banking. Some desired information could not be collected due to confidentiality of business. *Other limitations: I have lacking of previous experience in this concern. And many practical matters have been written from my own observation that may vary from person to person. 1. 5 Methodology of the study: 1. 5. 1 Methods of data collection: Methodology is the study or theoretical analysis of particular working methods. Adoption of methodology is an important factor in performing any study. If the methodology of the study is properly adopted and the study runs properly according to the methodology, the study is supposed to be successful.The following represents the methodology of the study. * Conceptualization: Conce ptualization is the way of developing concepts about the thesis topic and its related topics and its related matter the study follows a procedural approach in order to get complete picture of concentration of different banks initiatives to green banking in worldwide and in Bangladesh. * Theoretical Framework: This report theoretical framework is focused on the insight of the current process theories and techniques in related to practicing green banking to get sustainability.It emphasizes the green banking policy, green banking strategies, green products and probable key opportunities of the products. And their inter relationship with making the environment green. 1. 5. 2 Sources of Data: * Primary Sources: The â€Å"Primary Sources† are as follows- i. Face-to-face conversation with the respective officers and staffs of the Branch. ii. Informal conversation with the investment clients. * Secondary Sources: The â€Å"Secondary Sources† of data and information are: i. Ann ual Report (Last five years) of different Banks’. ii.Periodicals published by Bangladesh Bank. iii. Various books, articles, compilations etc. regarding green banking functions, and the policies. 1. 5. 3 Data processing and analysis: Collected data and information both from primary and secondary sources were analyzed in the. Raw data from the survey have collected and edited and then classified and edited and then classified according to the objectives. I have used some techniques for the purpose of analysis. These are: * Theoretical analysis * Graphical analysis * Tabular analysis 1. 5. Preparation of the report: Following steps are associated with the preparation of this thesis: I. Representations of the assembled data through graph II. Preparation of the draft report III. Preparation of the final report 1. 5. 5 Flow Chart of the study Methodology: Conceptualization Developing Theoretical Framework Fixing Goals and Objectives Data Collection Primary Data Secondary Data Rela ted Organization Identification of the Potential Problem Data Organization Data Processing, Interpretation and Analysis Findings Recommendations Report PresentationLiterature Review: A comprehensive literature study was done to gain an exact scenario of the present status of green banking. During the literature survey relevant information was collected from a number of books journals, magazines, reports, government and non-government documents and other printed materials from the concerned financial and non-financial institutions. A very little study was conducted with the intensity of the green banking till today, although green banking is a burning issue and very crucial phenomena for the present world banking industry.Green (1989) revealed that a bank's responsibility extends to Government, customers, shareholders, staff, and the community. Companies do have ethical responsibility, but it is not protected by limited liability from the consequences of their actions. A company's re cord and the perception of its ethics affect its reputation and ensure long-term success or failure. Further, he concluded that as we face increasingly complex and conflicting issues, our commitment to ethical behavior would be tested. Hitt, Keats and DeMarie (1998) identified strategic challenges and discontinuities encountered by firms in 21st century.They analyzed that to build and maintain competitive advantage, requires a new types of organization, leaders for survival and global market leadership. It was concluded that success in 21st century organization would depend on building strategic flexibility like exercising strategic leadership, building dynamic core competencies, focusing and developing human capital, effectively using new manufacturing technologies and implementing new organization structures and culture. Therefore, the responsibility of banks in this scenario should be reviewed so that changes of 21st century can be effectively controlled.There is a strong need fo r re-inventing the role of banks as Jeucken (2001) has compared three world regions Europe (24 banks), North America (6 banks) and Oceania (Japan and Australia; 4 banks) for the period of 1998 to 2000. He analyzed and focused some important differences between regions, countries, and banks with regard to sustainable banking. The methodology was entirely based on studying environmental and annual reports of banks. He concluded that 53 percent of the banks adopt a defensive position towards the environment issue.Still, a large group of banks do not see the role, which they can play a sustainable development. Sahu and Rajasekhar (2005) addressed and analyzed certain questions regarding bank credit to the agricultural sector and impact of the closure of rural bank branches on the provision of credit to agriculture by analyzing the data on the total outstanding credit provided by the scheduled commercial banks to the agricultural sector during the period 1981 to 2000 and concluded that p rofit-oriented norms persuaded commercial banks to neglect the agricultural sector, provision of a credit subsidy reduce the supply of agricultural credit.Lyne, Nielson, and Tierney (2009) evaluated and analyzed10, 000 Multilateral Development Banks (MDBs) loans from 1980 to 2000. They found that (MDBs) dramatically increased social lending for health, education, and safety nets after 1985. Yet the great powers’ social policy preferences remained relatively static from 1980 to 2000. This contradicts the conventional view that powerful states control International Organizations (IOs). They argued that highly institutionalized IOs like MDBs require a complete model of possible member-state coalitions encompassing the preferences of all member states—not just major powers.McMichael (2009) questions the Bank's new vision, arguing that ‘new wine in old bottles’ will continue to supply affluence rather than ‘feed the world’ and sustain its agricultu res, especially at a time when land is being commandeered for luxury foods (e. g. the livestock complex, all-season vegetables and fruits) and bio-fuels, neither of which feed the poor. Ironically, the reproduction of poverty remains the Bank's main source of legitimacy. Goyal and Joshi (2011) studied a sample of 19 bank mergers (post liberalization) based on umber of branches and geographical penetration in the market. Apart from financial aspects, they observed some emerging issues like employees’ perception, branch size, customer perception, communication, change management strategies, and human resource management. These issues can be settled when a bank implements certain social and ethical policies. Weber and Remer (2011) described Social Banking as a way of value-driven banking that has a positive social and ecological impact at its heart, as well as its own economic sustainability.Most of the Social Banks came out of the crisis much stronger and bigger than they were before. In addition, none of the Social Banks had to be bailed out with public funds. This increasingly attracts the interest not only of clients searching for safe and sensible ways to deposit their funds but also of conventional banks that begin to understand the potential of a more socially oriented approach towards banking. It is a matter of awareness, which compel us to have some views from a different outlook.Bearing in mind the various functions of a bank and current scenario, now it is high time to understand the role of banks in 21st century. Therefore, this study is conducted to understand the various roles and responsibilities of banks in order to strive more effectively and efficiently against some current issues, which has already attracted the attention of the world. Following are the objectives to uncover the issues: * To understand the various roles and functions of Banks. * To know various emerging issues of 21st century in Banking Industry of India.The synopsis of my report literature review is Green Banking; the focus is on satisfying existing needs in the real economy and the society; also taking into account their social, cultural, ecological, and economic sustainability. In the repercussion of the crisis, many people felt that green banking is more caring for the overall progress of society than traditional and mainstream banking. It is assumed that green banking may provide important lessons for the banking and financial sector to avoid further crises in the future. 2. 1 Nature of the Research: Research is the systematic investigation into existing or new knowledge.It is used to establish or confirm facts, reaffirm the results of previous work, solve new or existing problems, support theorems, or develop new theories. The goal of the research process is to produce new knowledge or deepen understanding of a topic or issue. This process takes three main forms: I. Exploratory Research: An exploratory study is undertaken when not much is kno wn about the situation at hand or no information is available on how similar problem or research issues have been solved in the past. II. Constructive Research: Constructive research tests theories and proposes solutions to a problem or question.III. Empirical research: Empirical research tests the feasibility of a solution using empirical evidence. The literature review of this report is saying us a very little study was conducted with the intensity of the green banking till today, although green banking is a burning issue and very crucial phenomena for the present world banking industry. So, definitely my this report research type is exploratory research because, An exploratory study is undertaken when not much is known about the situation at hand or no information is available on how similar problem or research issues have been solved in the past.Green Banking: Global warming, which is one of the most burning & discussed issues, has the worst impact on the climate of the planet a s a whole. The rapid change in climate will be too great to be adapted by the eco-systems, since the change have already made direct impact on biodiversity, agriculture, forestry, dry land, water resources and human health. As such, issue of global warming calls for a global response. Due to unusual weather pattern, rising greenhouse gas, declining air quality etc. ociety demands that business also take responsibility in safeguarding the planet. The key areas of environmental degradation cover air pollution, water pollution, surface water scarcity, encroachment of rivers, improper disposal of industrial, medical and house-hold waste, deforestation, loss of open space, loss of biodiversity and many other issues. In response to increasing awareness over climate change, environmental degradation, urgent measures for sustainable development have been addressed by some of the stake holders all over the world.Banking system hold a unique position in an economy that can affect production, business and other economic activities through their procedure for financing activities which would in turn contribute to protect environment/climate from pollution. Moreover, efficiency in energy use, water consumption and waste reduction may significantly contribute for operating cost of many of the large banks of the country.Projects/Businesses those include waste prevention and resource efficiency systems in a wide range of sectors including community, commercial and business organizations – such as shopping centers, regional airports, hospitals, construction, farms, a university, public organizations, and educational organizations are receiving enhanced attention these days. Green finance as a part of Green Banking makes great contribution to the transition to resource-efficient and low carbon industries i. e. Green industry and green economy in general.Green banking is a component of the global initiative by a group of stakeholders to save the climate/ environment. Gree n banks or environmentally responsible banks do not only improve their own standards but also affect socially responsible behavior of other businesses. 3. 2 Why Green Banking: 3. 1 What is Green Banking: * * Green Bank means * An ethical bank * A socially responsible bank * A sustainable bank. * Green Banking is to support: * Innovative green products * Activities those are not hazardous to environment and help conserve environment. To help safeguard the planet from * unusual weather pattern; * rising greenhouse gas; * Declining air quality. * For ensuring green economic growth: economic growth which is sustainable. * To meet one of the Millennium Development Goals: Ensure Environmental Sustainability. 3. 3 Definitions of Green Banking: 3. 3. 2 The Broad focus: 3. 3. 1 In general focus: Green Banking is like a normal bank' which considers the entire social and environmental factors; it is also called as an ethical bank' Ethical banks have started with the aim of protecting the envir onment.Green banking refers to the efforts of the Banking sector to keep the environment green and to minimize greenhouse effects through rationalizing their strategies, policy, decisions and activities pertaining to banking service, business and in-house operational activities. Green banking may be seen as a component of the global initiative from Banks end to save environment. Green banks or environmentally responsible banks do not only improve their own standards but also affect socially responsible behavior of other business. Green banking can benefit the environment either by reducing the carbon footprint of consumers or banks.Either works, some with paper. Either a bank o (a consumer can conserve paper and benefit the environment. Ideally, a green banking initiative will involve both. Online banking is an example of this. When a bank’s customers go online, the environmental benefits work both ways. Green banking means combining operational improvements and technology, a nd changing client habits. 3. 3. 3 The definitions derived from specialists: * Sherman stresses (Key Differentiator of Green Choice Bank, Chicago): â€Å"With green banking, what sets leaders apart from the rest is†¦ ow you invest back in the community, so we are trying to develop loan products and deposit products that reward good environmental choices * Todd Larson (Community investing guide, green America): â€Å"a green bank is a logical extension of -socially responsible investing. † * Sherman Stresses, (Key Differentiator of Green Choice Bank, Chicago): â€Å"With green banking, what sets leaders apart from the rest are†¦ how you invest back in the community, so we’re trying to develop loan products and deposit products that reward good environmental choices†. Todd Larson (Community investing guide, green America): â€Å"A green bank is a logical extension of socially responsible investing. † * Justin Pritchard (columnist, about com): â⠂¬Å"Green Bank is a bank focusing on sustainability. It is bank like others but they are to claim the â€Å"green banking† niche, and they hope to excel by serving companies and individuals interested in green business. For the most part, the bank will work with businesses that find ways to do more and use less†. * Pravakar Shahoo (Author, Green Banking in India): The banks should go green and play a pro-active role to take environmental and ecological aspects as part of their lending principle, which would force industries to go for mandated investment for environmental management, use of appropriate technologies and management systems†. * Geoff Green wade, President and CEO, Green Bank (Houston): â€Å"Green banking means combining operational improvements and technology, and changing client habits†. * Stacy Ayiers (Author, Green banking-a new resource bank): â€Å"Specific banks designed to aid environmentally-conscious businesses and consumers with bet ter incentives and loan rates.Despite the changes in our economic system in business caused by the housing market, these banks are willing to work with companies who want to empower sustainability†. 3. 4 Conceptual derivation of Green Banking: : Americans are starting to turn to eco-friendly banking as a way to help reduce the carbon footprint from their normal banking activities. This movement away from branch and paper banking is being led by green banks that believe in social responsibility. The discussion around environmental management in financial institutions has until now largely taken place in industrialized countries.However, in view of the financial globalization and ever increasing environ-mental regulations, many financial institutions operating in developing and emerging countries are pressed to better manage risks arising from environmental liabilities. Besides credit and market risks, damage to an institution’s reputation often represents an important dr iver for international banks. Domestic players – including microfinance institutions may have different incentives, among others to contribute to local development, but they play an equally important role.Empirical research since 1990 concluded that banks were not interested in their own environmental situation or that of their clients. We are witnessing certain changes and growing awareness in the field of financial sector like; environmental investment funds, loans, green banking, global banking, rural banking, agri-banking, social banking and ethical banking. * Social Banking: In Social Banking, the focus is on satisfying existing needs in the real economy and the society; also taking into account their social, cultural, ecological, and economic sustainability.In the repercussion of the crisis, many people felt that social banking is more caring for the overall progress of society than traditional and mainstream banking. It is assumed that social banking may provide import ant lessons for the banking and financial sector to avoid further crises in the future. According to Institute for Social Banking, â€Å"Social Banking describes the provision of banking and financial services that consequently pursue, as their main objective, a positive contribution to the potential of all human beings to develop, today and in the future†.Benedikter (2011) defines Social Banks as â€Å"banks with a conscience†. They focus on investing in community, providing opportunities for the disadvantaged, and supporting social, environmental, and ethical agendas. Social banks try to invest their money only in endeavors that promote the greater good of society, instead of those, which generate private profit just for a few. He has also explained the main difference between mainstream banks and social banks that mainstream banks are in most cases focused solely on the principle of profit maximization whereas, social banking implements the triple principle of profi t-people-planet.Social banks care about making a profit, but equally for promoting human and environmental well-being. It is this triple principle that they follow when they decide to whom to lend money, and for what purpose. It means that social banks consider social and economic â€Å"sustainability† when making financial decisions. â€Å"Sustainable† investments and lending practices are ones that produce a better quality of life for the greatest possible amount of people, and whose effects endure over time and continue to produce a multiplicity of positive effects long after the initial investment.Now-a-days, social banks are becoming cultural power as social banking includes the concepts of humane and humanist in financial activities. * Ethical Banking: The Cooperative Bank (UK) offers its customers home energy rating on purchases of consumer durables. The purpose is to enable them to better understand how energy efficient a property is and how to make improvement s. Moreover, bank's mortgages include carbon-offset features. Every year that a customer holds a mortgage, the bank offsets a fifth of the carbon dioxide emissions arising from a typical household's energy consumption.Following customer consultation in 2003, offset money were used for reforestation in Uganda, a Bangladesh project that trains local people to build energy efficient stoves and a Bulgaria project supporting micro-hydro electricity generation. Citizens Bank (Canada) allows its customers to choose between a variety of VISA cards that benefit Oxfam Canada, Amnesty International or their philanthropic Shared Interest program by donating $0. 10 to not-for-profit initiatives worldwide every time their VISA card is used. This enabled Citizens Bank to donate thousands of dollars to Doctors.These are only a few of the wide range of services available at different ethical banks. * Agri-Banking Alston (2004) argued that international and national events like globalization, interna tional policy manipulations such as the US farm bill, and national policy, are having a major impact on agricultural production in Australia. It is more likely that these issues are acting to continue and exacerbate a trend towards reduced viability for farm families evident in economic and social trends since at least the 1950s.It was further argued that social aspects of agricultural production in Australia noting social trends and drawing attention to the changing social relations of agriculture. It was concluded that there is dominance of farm families, the role of corporate agriculture, ethnic diversity, the importance of women, and the practice of farm transfers. Punjab National Bank’s (PNB) Corporate Social Responsibility Report (2010) shows that agriculture and farmer’s related initiatives are taken by PNB increased lending to agriculture, weaker sectors and women; which results in impacting their lives through income generation.Moreover, the report shows that the Bank has established two trusts viz. , PNB Farmers Welfare Trust and PNB Centenary Rural Development Trust. These trusts are involved in running training centers which imparts training in farming and also other non-farm activities. PNB Farmers’ Welfare Trust was established in the year 2000 for welfare of the farmers, women and youth in rural areas. Under the aegis of the Trust, 8 Farmers’ Training Centers (FTCs) have been made operational at villages.Apart from this Mobile Van is being used at FTC Sacha Khera for providing off-site training on improved package & practices of agricultural crops & allied activities, soil testing and Jatropha cultivation. In addition, the van is acting as an information kiosk. * Rural Banking: Ramachandran and Swaminathan (2002) examined the effect of financial sector reform on rural banking and rural credit transactions in India. They reviewed the trends in selected indicators of rural banking at the national level over the last 30 years.Moreover, they used longitudinal data for a village in Tamil Nadu to examine changes in patterns of indebtedness and credit transactions among landless labor households. They concluded that the exploitation of landless labor households in the credit market has intensified with the introduction of financial reforms and lastly, the policy was envisaged as an alternative to the formal credit sector in the countryside. Burgess and Pande (2005) evaluated the impact of a large state-led bank branch expansion program in India on rural poverty between 1977 and 1990.They used deviations and regression analysis and found that branch expansion into rural unbanked locations in India significantly reduced rural poverty. * Global Banking: Miller, S. R. and Parkhe, A. (2002) conducted empirical test of the liability of foreignness in the global banking industry, using Fitch–IBCA Bank Scope data for the period 1989–96 and their findings strongly support the liability of foreignn ess hypothesis. Further, the data showed some evidence that the X-efficiency of a foreign-owned bank is strongly influenced by the competitiveness of its home country and the host country in which it operates.Moreover, it was found that in some environments U. S. -owned banks is more X-efficient than other foreign-owned banks in some environments, but less X-efficient in others. Mathur, N. D. (2009) has identified a visible trend that growing integration of economies and the markets around the world is making global banking a reality. The use of Internet banking has widened frontiers of Global Banking and it is now possible to market financial products and services on a global basis. Like other industries, banking has become more global. Banking stands out, however, in its legal form and reliance on cross border positions.Banks run special risks in lending abroad. McCauley, McGuire and Peter (2010) have shown that some banking systems are international in their organization while ot hers are multinational, and that the multinational model can be operated with a greater or lesser degree of centralization. While much work remains to be done in assessing the performance of various banking models during the crisis, it does appear that local assets proved more stable under stress. Cross-border claims and liabilities proved less stable. These findings hold even if account is taken of the series break represented by US securities irms becoming reporting banks, exchange rate changes and distortions from mergers and acquisitions, some of which resulted from the crisis itself. * Other Issues: Banks, usually take help of various Information Technology (IT) based channels to provide their banking and other services. For this purpose, they are in need to provide continuous and frequent information about their services. We can use IT as a strong means to fulfill our objectives social and ethical banking. The IT based banking services are as follows: Mobile Banking is a new a nd emerging concept.Large numbers of people are still not aware about usage of mobile banking. In this, one's mobile phone is used to conduct banking transactions. The popularity of Online Banking is significantly increasing day by day. It is a term used for performing various transactions, payments, and account statements etc. with the help of Internet. Relationship Managers, mostly for private banking or business banking, often visit customers at their homes or businesses. Video banking is a term used for performing banking transactions or professional banking consultations via a remote video and audio connection.Video banking can be performed via purpose built banking transaction machines (similar to an Automated teller machine), or via a Video conference enabled bank branch clarification. * 3. 4. 1 Flow Chart of conceptual derivation of Green Banking: Green Banking: There are some major concerns about environmental issues. Therefore, organization need to pay attention to their o utputs whether they are violating environmental issues or not. At Triodos Bank, it is believed that profit should not be earned at the expense of the world's most pressing environmental problems.That is why they finance organizations from organic food and farming businesses and pioneering renewable energy enterprises, to recycling companies and nature conservation projects. Citizens Bank of Canada has lowered its interest rate on loans for carbon emission cars. These kinds of efforts will surely motivate other banks to promote green banking and consequently in long run environmental issues can be resolved. Agri Banking Rural Banking Global Banking Social Banking Ethical Banking Other Issues Green Banking 3. 4. 2 Green Banking: A New Eco-Friendly Concept in Banking Arena:Green banking is a component of the global initiative by a group of stakeholders to save environment where, sustainable development has emerged as a new paradigm of development in response to the current discourse of development that over-exploits natural environment for economic prosperity. The sustainable development can best be achieved by allowing markets to work within an appropriate framework of cost efficient regulations and economic instruments. One of the major economic agents influencing overall industrial activity and economic growth is the financial institutions such as banking sector.The banking sector influences the economic growth and development in terms of both quality and quantity, there by changing the nature of economic growth. Banking sector is one of the major sources of financing investment for commercial projects which is one of the most important economic activities for economic growth. Therefore, banking sector can play a crucial role in promoting environmentally sustainable and socially responsible investment (SRI). Banks may not be the polluters themselves but they will probably have a banking relationship with some companies/investment projects that are polluters or could be in future.Banking sector is generally considered as environmental friendly in terms of emissions and pollutions. Internal environmental impact of the banking sector such as use of energy, paper and water are relatively low and clean. Environmental impact of banks is not physically related to their banking activities but with the customer’s activities. Therefore, environmental impact of bank’s external activity is huge though difficult to estimate. Moreover, environment management in the banking business is like risk management.It increases the enterprise value and lowers loss ratio as higher quality loan portfolio results in higher earnings. Thus, encouraging environmentally responsible investments and prudent lending should be one of the responsibilities of the banking sector. Further, those industries which have already become green and those, which are making serious attempts to grow green, should be accorded priority to lending by the banks. This method o f finance can be called as â€Å"Green Banking†, an effort by the banks to make the industries grow green and in the process restore the natural environment.This concept of â€Å"Green Banking† will be mutually beneficial to the banks, industries and the economy. Not only â€Å"Green Banking† will ensure the greening of the industries but it will also facilitate in improving the asset quality of the banks in future. Internationally, there is a growing concern about the role of banking and institutional investors for environmentally responsible/socially responsible investment projects. Banking and other financial institutions are more effective towards achieving this goal for the kind of intermediary role they play in any economy and for their potential reach to the number of investors.Environment is no longer the exclusive concern of the government and the direct polluters, but also the other partners and stake- holders in the business like financial institution s such as banking institutions can play a very important role in fostering linkage between economic development and environmental protection. To substantiate, quality of service, the implementation of environmental conservation measures, support to the deprived section of the society, concern about the quality of life and nature are the basic principles that the financial institutions are relying on in their business strategy in recent years.The banking operation targets a certain long-term rate of return on their credit and investment. Therefore, it is of importance to the banking sector to follow certain environmental evaluation of the projects before financing. There are studies showing positive correlation between environmental performance and financial performance (Hamilton, 1995; Hart, 1995; Blacconiere and Pattern, 1993). Thus, it is imperative for the financial institutions in the present context to consider environmental performance in deciding whether to invest in companie s or advise clients to do so.The formation of different rules for environmental management like resource conservation, clean water act, clean air act, toxic substance control act are also viewed as potentially significant contributor to the recent increase in environmental liability for banking institutions. Adoption of these principles will offer significant benefits to financial institutions, to consumers and also the stakeholders. There have been attempts to adopt sustainable development strategies from various quarters at international level.Multilateral agencies, international consortiums, multilateral financial and development institutions have been advocating for environmental standards and strategies to evaluate investment projects. In the recent years, the international organization for standardization (ISO) has issued series of comprehensive guidelines for incorporating environmental protection and pollution prevention objectives into industrial activity worldwide, known c ollectively as ISO 14000. It would certainly give the much needed impetus for the banking industry to expand the use of environmental information in their credit extension and investment decisions.In this backdrop, the paper aims to discuss the issues of sustainability in Banking and how banks can play a role for sustainable growth and development, particularly in the Bangladesh context. The state of environment in Bangladesh is rapidly deteriorating. The key areas of environmental degradation cover air pollution, water pollution and scarcity, encroachment of rivers, improper disposal of industrial medical and house-hold waste, deforestation, and loss of open space and loss of biodiversity. In addition, Bangladesh is one of the most climate change vulnerable countries.In line with global development and response to the environmental degradation, financial sector in Bangladesh should play important roles as one of the key stake holders. In response to the above, urgent measures are r equired by stake holders for sustainable development and thereby save the planet. Banks hold a unique position in an economic system that can affect production, business and other economic activities through their financing activities and thus may contribute to pollute environment. Moreover, energy and water efficiency and waste reduction are of high concern for many big banks.Green banks or environmentally responsible banks do not only improve their own standards but also affect socially responsible behavior of other business. 3. 4. 4 Green Banking & Environmental Risk Management Interrelationship: 3. 4. 3 Green Banking & Sustainable Growth: Sustainable development meets the need of present generation without compromising the ability of future generation to meet their own needs. The key to sustainable development is to ensure broad-based inclusive economic growth, with: * Promotion of natural resources; Preservation of regenerating capacity of ecological system; * Avoidance of envi ronmental risks on future generations. Banking sector can play an intermediary role between economic development and environmental protection. Green Banking & Environmental Risk Management (ERM) move together to care for: * Environmental problems * Poverty & environment * High consumption patterns * Health and environment * Moral obligation 3. 4. 6 Scope of Green Banking: 3. 4. 5 Purpose of Green Banking:The purpose of Green Banking Policy will be to ensure necessary measures to protect environmental pollution while providing service or financing customers as well as to improve in-house environment management through efficient use of various resources at Head Office, Branches and other link offices. This policy document will be applicable for issues related to Green Banking with respect to activities of the Bank and its customers that have impact on the environment. 3. 4. 7 Benefits of Green Banking: Apart from enrichment of the external environment, Green Banking may also help impr ove the performance of the Bank in the following ways: Basically Ethical (Green) banking avoids as much paper work as possible and rely on online/electronic transactions for processing so that you get green credit cards and green mortgages. Less paperwork means less cutting of trees. * Creating awareness to business people about environmental and social responsibility enabling them to do an environmental friendly business practice. * Green (Ethical) banks adopt and implement environmental standards for lending, which is really a proactive idea that would enable eco-friendly business practices which would benefit our future generations. When you are awarded with a loan, the interest of that loan is comparatively less with normal banks because ethical banks give more importance to environmental friendly factors – ecological gains. Natural resources conservation is also one of the underlying principles in a green bank while assessing capital/operating loans to extracting/industr ial business sector. * Improve the image of the Bank by showing and serving its commitment to the environment. * Significantly reduce operational cost due to less consumption of office stationeries, energy and water. Enhance productivity as well as efficiency of the employees through skilled & optimum usage of technology. * Reduce possible health hazards by installing eco-friendly equipments. * Save significant portion of Forestry by reducing paper usage * Lessen emission of Green House Gases (GHGs) through making less corporate travelling through teleconferencing as well as arranging transport pool for the employees. * Help develop customer’s consciousness on environment by arranging awareness development program * Reduce the extent of Non-Performing Loans (NPLs) if investment goes to less risky projectsThe Initiatives for Promoting Green Banking: 4. 1 Ethical Initiatives and Community Involvement: Numerous banks (as well as some conventional banks) create initiates that all ow the banker to contribute to organizations that have positive societal environmental impacts either in the local community or in developing countries. For example the Cooperative Bank (UK) offers customers â€Å"a free Home Energy Rating on all house purchases, enabling them to better understand how energy efficient a property is and how to make improvements. Additionally, all of the bank's mortgages include carbon-offset features.Every year that a customer holds a mortgage the bank offsets a fifth of the carbon dioxide emissions arising from a typical household’s energy consumption following customer consultation 2003 offset monies were used for reforestation in Uganda, a Bangladesh project which trains local people to build energy efficient stoves and a Bulgaria project supporting micro-hydro electricity generation. Whereas the Citizens Bank (Canada) allows its customers to choose between a variety of VISA cards that benefit Oxfam Canada Amnesty International or their ph ilanthropic Shared interest program by donating $0. 0 to non-for-profit initiatives worldwide every time their VISA card is used. This enabled Citizens Bank to donate $24,800 to Doctors without Borders/ Medicines Sans Frontiers in 2007. These are only a few of the wide range of services available at different ethical banks. Many also have lower interest loans for low emission cars (ex. of low emission car initiative put forth by citizens Bank). Ethical banks excel in community involvement, as do other financial instructions such as credit unions. Community involvement is not limited to ethical banks as conventional banks also partake in such actions.The following are a few examples of community involvement done by ethical banks, credit unions, and conventional banks: * Affordable housing projects (ex. Van city ; Citizens bank) * Many banks/credit unions try to increase financial literacy and consciousness for environment in the community * Financially support community events (for e x. each year TD Canada trust donates to a local cause). The role of Green banking in Environmental Management. The world has seen much focus on economic progress and mankind has made giant steps in its journey through time.The side effects of the development process have’ however, also been equally enormous-loss of biodiversity' climatic change' environmental damage, etc. Social issues such as, poverty alleviation have also become more important as the world has progressed economically’ Banks play an important role in development of an economy. The economic reforms totally have changed the banking sector. The banking sector forming a portion of the financial sector primarily works as a financial intermediary generating money supply.The banks should go green and play a pro-active role to take environmental and ecological aspects as part of their lending principle, which would force industries to go for mandated investment for environmental management' use of appropriate technologies and management systems. Banks that are serious about sustainable development put principles at the heart of decision-making' Fundamental issues such as how deals are done and loans are made, in searching proactively for opportunities and even in establishing and adhering to policy frameworks that deliberately preclude involvement in certain investments.For example, an investment in a factory that pollutes heavily (and passes on the costs to the society at large) will generally have a higher financial rate of return than a factory that invests in expensive pollution control technology' as a result showing a lower rate of return. A Green Banking movement such as less paper is good for the environment where Customers make paper less deposits, withdrawals and remittances. Going green through I. No paper statements (statements and charges summaries will be delivered electronically Via Internet Banking) II.Fewer letters to open (Bank will call or email us for service reasons wherever possible rather than write to us) III. No cheque book or paying-in book for our current account. IV. No paper-based marketing. The Bank can concentrate on Nature and environment by projects in the field of renewable energy (wind energy & hydro-electric projects), organic agriculture across the entire value chain including health food shops and environment technology such as recycling companies and nature conservation projects.As environmental issues gain greater attention, pressures are being placed on all industries, including financial services, to implement â€Å"green† initiatives. Like Resource conservation through cash recycling, double-sided statement print-outs’ electro mobility. 4. 2 International Initiatives for Green Banking: The financial sector’s glowing adherence to environmental management system is attributed to the direct and indirect pressures from international and local Non-Governmental Organizations (NGOs), multilateral agencies an d in some cases the market through consumers.In the early 1990s, the United Nations Environment Program (UNEP) launched what is now known as the UNEP Finance initiative (UNEPFI). Some 200 financial institutions around the globe are signatories of this initiative statement to promote sustainable development living the framework of market mechanisms toward common environmental goals. The objective is to integrate the environmental and social dimension to the financial performance and risk associated with it in the financial sector.As the commitment of this UNEPFI statement goes, sustainable development is regarded basic to the sound business management. It advocates for a precautionary approach towards environmental management and suggests integrating environmental considerations into the regular business operations, asset management, and other business decisions of the banks. IFC's environmental unit was established in 1991 for reviewing each project for environmental assessment.Simi larly, the US Export-Import Bank regularly reviews while financing exports on the ground whether they are environmentally sound. It will be noteworthy to mention that Netherland-based ABN-Amro bank has developed certain Reputational Risk Management (RRM) policies to identify, asses and mange non-financial present within it business engagements- Similarly, some of the big international banks like ABN Amro, Deutsche, Standard Chartered, HSBC Bank etc. look at environment issues discussed under Kyoto Protocol.Going further, the Dutch Government has made a formal request to barks in achieving sustainable development. The dialogue between banks and government was established in 1999 to initiate policies for environmental improvements through the development of new financial products and services. Similarly, Earth (FOE) and the Rainforest Action Network (RAN) challenged the industry with high-profile campaign that highlighted cases in which commercial banks were -bankrolling disasters in 2000 in the US.In 2002, a global coalition of NGOs formed a network named Bank Tract’ to promote sustainable finance in the commercial sector. This coalition came up with a resolution constituting six principles promoting environmental protection and social justice by banks and this is popularly known as â€Å"Collevecchio Declaration†. The six principles that this declaration advocated included commitments to sustainability no-harm responsibility, accountability, transparency and sustainable market, and governance.More than 200 organizations have endorsed this declaration and urged the banks to incorporate these commitments into their business operation The declaration states that -Finance and Commerce has been at the center of a historic detachment between the world's natural resource base, production and consumption. As we reach the boundaries of ecological boundaries of the ecological limit upon which all commerce relies, the financial sector should take its share of responsibility for reversing the effects this detachment has produced.All these concerns for sustainable finance or green finance have compelled the banking institutions to devise a common and coherent set of environmental and social policies and guidelines that can be used to evaluate the projects. A small group of banks along with IFC carne together to initiate the process of designing the common guidelines in October 2002 and came up with a guidelines in June 2003 that is known as Equator Principles with 10 leading commercial banks adopting these voluntary set of principles.This equator principle was subsequently updated and the new revised sets of principles are hunched in July 2006. The coverage of projects being financed is expanded in this revised set of principles by lowering the finance threshold from $50 million to $10 million presently 46 financial institutions from 16 countries with business operation in more than 100 countries have embraced this equator principle, So this principle has become a common standard of project finance that imported environmental and social issues in project finance.The activities of the equator banks (banks adopting equator principles) are being reviewed by NGOs worldwide and are being published whenever it is realized that they are not committed to Equator Principle. IFC along with the Financial Times has initiated Sustainable Banking Award' since 2006. More than 104 financial institutions out of 151 entries from 51 countries have made it to the final lists of award 2007. The number of banks applying was up by more than 100 percent compared to the previous year’s 48 banks from 28 countries.All the international initiatives towards integrating environmental concerns into business operation of banks are voluntary in nature and are meant to a common good of a better ecosystem Voluntary commitment has its own shortcoming in a competitive market. Unless the market for green money will increase, the lenders will al ways have an incentive to increase their social commitment and prioritize the commercial interest in the short run. So demand for green money is a precondition of green banking if it will be voluntary.A Government legislation that makes banks accountable for the misdeeds of their clients will help promotes green banking. 4. 2. 1 Global initiatives: Durban Climate Conference: Governments agreed to adopt a universal legal agreement on climate change by 2015. Key Decisions: * Green Climate Fund to be made available to developing countries by 2012. * Adaptive capacities of the poorest and most vulnerable countries to be strengthened. * Technology Mechanism to become fully operational by 2012. * Web-based registration of developing country mitigation actions seeking financial support. . 3 Domestic Initiatives for Green Banking: : Though be late, Bangladesh is now aware that global warming is an issue that calls for a global response. The rapid change in climate will be too great to allow many eco-systems to suitably adapt, since the change have direct impact on biodiversity, agriculture, forestry, dry land, water resources and human health. Due to unusual weather pattern, rising greenhouse gas, declining air quality etc. society demands that business also take responsibility in safeguarding the planet.Green finance as a part of Green Banking makes great contribution to the transition to resource-efficient and low carbon industries i. e. green industry and green economy in general. Green banking is a component of the global initiative by a group of stakeholders to save environment. The state of environment in Bangladesh is rapidly deteriorating. The key areas of environmental degradation cover air pollution, water pollution and scarcity, encroachment of rivers, improper disposal of industrial medical and house-hold waste, deforestation and loss of open spaces and loss of biodiversity.In addition, Bangladesh is one of the most climate change vulnerable countries. In line with global ; development and response to the environmental degradation, financial sector in Bangladesh can play important roles as one of the key stake holders. In response to the above, urgent measures are required by stakeholders for sustainable development and thereby save the planet. Banks hold a unique position in an economic system that can affect production, business and other economic activities though their financing activities and thus may contribute to protect environment.Moreover, energy and water efficiency and waste reduction are of high concern for many big banks- Green banks or environmentally responsible banks do not only improve their own standards but also affect socially responsible behavior of other business. 4. 3. 1 Bangladesh Bank's Earlier Initiatives: Bangladesh Bank (BB) is well aware of the environmental degradation situation as mentioned above and has already given time to time directions to all scheduled banks.Commercial Banks are now required to e nsure necessary measures to protect environmental pollution while financing a new project or providing working capital to the existing enterprises. Banks have been advised to facilitate their clients with utmost care in opening Letter of Credit (L/C) for installation of Effluent Treatment Plant (ETP) in the industrial units. Banks have been advised to finance in Solar Energy, Bio-gas, ETP and Hybrid Hoffman Kiln (HHK) in brick field under refinance program of BB.A comprehensive guideline on Corporate Social Responsibility (CSR) has been issued where banks have been asked to concentrate hard on linking CSR at their highest corporate level for ingraining environmentally and socially responsible practices and engaging with borrowers in scrutiny of the environmental and social impacts. Banks have been brought under the purview of E-commerce with a view to providing the customers with online-banking facilities covering payments of utility bills, money transfer and transactions in local c urrency through internet as well.Considering the adverse effects of Climate Change, banks have been advised to be cautious about the adverse impact of natural calamities and encourage the farmers to cultivate salinity resistant crops in the salty areas, water resistant crops in the water locked and flood prone areas, drought resistant crops in the drought prone areas, using surface water instead of underground water for irrigation and also using organic fertilizer, insecticides by natural means instead of using chemical fertilizer and pesticides. 4. 3. 2 Commercial Banks’ Attention to Green Banking:Bangladesh Bank governor urged the chief executive officers of the country’s banks to pay attention to green banking, by investing in energy efficiency and renewable energy projects. Central bank has a fund named -Renewable Energy Fund. Only two banks have so far taken the opportunities offered by the fund. The central bank governor made the request at the launching ceremony of the Environmental Risk management Guidelines. BB urged the banks and financial institutions to keep climate change and environmental considerations as priorities in their activities.The Impact of a deteriorating climate on financial institutions and business enterprise have driven the creation of the Environmental Risk Management Guidelines, encouraging banks and FIs to adopt risk management practices to safe guard against these inevitable environmental concerns. Detailed guidelines on green banking were Issued on February 27,2011 in which banks have been advised to give more emphasis to help environment by eliminating paper uses saving gas and carbon emissions, and reducing printing costs and postage expenses.Banks shall comply with the instructions stipulated in the detailed guidelines on Environmental Risk Management in consideration of a part of the Green Banking Policy. The comprehensive guidelines were developed by Bangladesh Bank in collaboration with IFC and with input f rom Bankers Association of Bangladesh and financial sector stakeholders and have been issued to all financial institutions in the country. The Major Area & Products of Green Banking 5. 1 The Major Areas of Green Banking: : Green banking can benefit the environment either by reducing the carbon footprint of consumers or banks.Either a bank or a consumer can conserve paper and benefit the environment. Ideally, a green banking initiative will involve both. Online banking is an example of this. When a bank’s customers go online, the environmental benefits work both ways. Other examples of what Green Bank Report considers forms of green banking on the consumer side include: * Green Deposits: Banks can offer higher rates on CDs, money market accounts, checking accounts and savings account if customers opt to conduct their banking activities online. Green Checking – converting checking accounts to online banking * Green Money Market Accounts – converting savings accoun ts to online banking * Green CDs – bonus rates for online banking * Green