Stakeholder relations of sustainable banks: Community benefit above the common good

Abstract

AbstractThis paper explores stakeholder relations of sustainable banks as organizations that simultaneously pursue the community development and market profitability goals. The study features the Global Alliance for Banking on Values (GABV), an international group of 62 financial institutions and 16 strategic partners, which collectively hold $200 billion USD of assets under management. Using the organizational identity orientation framework (Brickson, 2005, 2007), it reveals that, contrary to widely held assumptions that community‐focused organizations serve a broad common good purpose, sustainable banks take a relational stance based on effectively prioritizing community issues aligned with their missions and establishing strong partnerships with selected counterparts. Sustainable banks approach their stakeholder relations through the relational identity orientation expressed in the practices of inclusion of affected communities, full incorporation of local needs, philanthropic inclusiveness, transparency and power balance among stakeholders, governmental commitments, and relational hiring and socializing.