How much ‘more than a bank’ can a bank be?

HBL’s latest report shows that large organisations have the ability to do good and must start treating it as part of their duty

How much can one organisation do for the greater good? It really depends on the organisation. 

Take HBL for example. As Pakistan’s largest bank HBL is in a position of power where they can have a real world impact on Pakistan’s economy and its people. Recently announced as one of three Domestically Systemically Important Banks (D-SIB), HBL is large enough that when it moves thousands of lives move with it. 

At an event in Karachi to mark the launch of HBL’s Impact and Sustainability report for the year 2022, HBL’s senior leadership including its President and CEO spoke freely to the small gathering of bankers, clients, and journalists at the bank’s main offices at Clifton. The topic was what HBL had done and more importantly how the bank imagined itself. 

In the report, HBL proudly displayed how they had directly spent over Rs 4 billion over the past decade for the social uplift of Pakistan along with detailing their many internal and external actions and interventions that they think will directly impact the lives of everyday Pakistanis and help uplift them, the economy, and the natural environment of the world we live in. 

Many might take HBL’s report and claims with a grain of salt. Banks, afterall, get a bad reputation. These are the very same profit hungry institutions that parents warn their children to never trust and stay away from along with lawyers, real estate agents, and the scoundrels of the print media. But despite this bad press, the reality is that large organisations can be vehicles for good. 

In particular, the largest bank in any country can do more than its fair share in uplifting a country and its people. For starters, good banking products and a hunger to build a client base can bring large chunks of the unbanked population into the fold of formal financial institutions. Loans targeted towards SMEs and important sectors of the economy can help bring many out of poverty and boost economic activity in the country.   

In its recently released report, this is exactly what HBL says it wants to do. The operative word here is ‘wants’. Effective communication can go a long way and on this front HBL is successful. All of their messaging indicates that being a force for good and betterment is not something they feel they have to come across as but something they actively want to be. 

You see there is a vital difference between responsibility and duty. While the two are inextricably linked there is a certain passiveness in being responsible that is trumped by the pro-activeness of being dutiful — particularly in a corporate setting. You see responsibility is a burden. It is something you feel the need to address. It is a cheque you begrudgingly cut to keep up appearances. It is a weight that pulls you down. Duty, on the other hand, is a force that pushes you forward. An organisation feels the burden of responsibility but a sense of duty fuels its actions. 

By releasing its Impact and Sustainability report, HBL wants to firmly set itself in the latter category. This is something that regularly happens to large organisations. As time passes they want to position themselves as forces beyond just what their initial purpose was. That is now what HBL is trying to do — to be “More than just a Bank” as its senior leadership tells us over and over again. But just how much can a bank do?  

The philosophy they are trying to espouse 

Let us break this down to a very simple level. There are really only two things that a bank like HBL can do. The first is Corporate Social Responsibility (CSR) projects. These are causes that are either directly charitable or ones where money is being directed towards a certain end. These are things such as assistance with flood relief or sponsoring a sports tournament. And then there is the real work — building products that can change a country. 

As we’ve mentioned before, there is a lot a bank can do and especially in a country like Pakistan. The unbanked population is massive and in particular there is a dire need for women to be brought into the formal financial sector. Access to money for farmers, small businesses, and SMEs can also change the economic map of an entire country. 

So what does HBL want to do? “At HBL, sustainability is not merely a buzzword, but a fundamental pillar of our operations which includes integration of sustainable principles and practices across all facets of our organisation, from operations to supply chain to financial services and stakeholder management,” says Muhammad Aurangzeb. The origins of the report came from HBL’s recent decision to complete its commitment to achieving net zero emissions and green funding. 

“In pursuance of HBL’s commitment to inclusion, sustainability and community development, the Bank is pledged to: reducing its own emissions; expanding our Green Banking portfolio; expanding our women customer base to over 4 million; and contributing to the communities in which we operate by supporting healthcare, education, arts, and social development initiatives,” he adds. 

The ethos behind this, as per HBL, comes from its parent company — the Aga Khan Fund for Economic Development. “Upholding the ethos of the Aga Khan Development Network (AKDN), HBL’s good governance and Corporate Social Responsibility is not confined to charitable giving, but also directed at conducting our daily business and living our daily lives with constant care for our physical and social environments. As the country’s largest banking group, we can foster positive change by example, leading with our walk as well as our talk,” said Sultan Ali Allan, Chairman of HBL, in his message on the occasion.

What they’ve done that is CSR 

So what has HBL done? According to the summary of the report that they provided, HBL has contributed over Rs 4 billion – spread over a decade – for the social uplift of Pakistan. In 2022 alone, the Bank contributed over Rs 580 million.

There are many initiatives that HBL has launched that fall within the ambit of traditional CSR. On the one hand there are those that would insist large businesses are not responsible and forget the impact that they can have on a society. On the other hand whenever an organisation does try to do something for the greater good, their efforts are often dismissed either as marketing attempts or bare-minimum CSR work.

One such example is how HBL partnered with the Government of Pakistan and the National Disaster Management Authority (NDMA) to assist flood-affected families through Benazir Income Support Programme (BISP) and disbursed Rs 54 billion in relief to flood affectees. The bank has also funded 

the building of two purpose-built villages, comprising 100 homes each in Qamber Shahdadkot and Larkana in Sindh. The cost of these prefabricated villages that are equipped with solar panels is over Rs 264 million. In an internal move, aimed at supporting its experienced workforce and promoting job security, HBL extended its staff service age from 60 to 65 years in 2022.

What they’re doing that could be more

And then there is the next part. There is a lot that the HBL does in terms of CSR. There is still more they do on a larger scale such as being the sponsor for the HBL PSL which has helped bring cricket back to Pakistan. But the most important thing that Pakistan’s largest bank can really do is create products that will bring financial inclusion and access to money to people that need it. 

“The HBL Microfinance Bank has contributed tremendously to ensuring that we are the single largest provider of microfinance and SME services in Pakistan. As the country’s largest banking group, we can foster positive change by example, leading with our walk as well as our talk,” read the bank’s statement following the release of its report. 

“Our unwavering commitment to sustainability is enabling us to play a leading role in developing the agricultural sector and promoting food security through investing in relevant learning and infrastructure.”

As part of the HBL’s Development Finance initiative, the Bank has completed 17 pilot projects, supporting 550 farmers through in-kind financing for crops spanning over 45,000 crop acres. The bank has also developed its own Green Taxonomy (GT) which will facilitate directing capital flows to green projects. With a 27% increase in funding, HBL Foundation has deepened its contribution across key areas of need, ranging from health to education.

All of these moves from Microfinance to reaching out to farmers goes a long way for an organisation like HBL but also helps Pakistan. If the country’s largest bank is indeed to fulfil its desire to be “more than just a bank” it must continue on this trajectory — both for its own ambitions and for the sake of the country. 

Abdullah Niazi
Abdullah Niazi
Abdullah Niazi is senior editor at Profit. He can be reached at [email protected]



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