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Ways of Saudi Arabia Banks Improvement to Achieve 2030 Vision and other Future Development Plans
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Problem Statement and Justification of the Research Project
As the Kingdom of Saudi Arabi seeks to achieve 2030 vision and other future development plans, it is important to investigate the influence of corporate social responsibility (CSR) on the financial performance of the local banks, customer loyalty, commitment, and reputation.The expectations and aspirations associated with Saudi Arabias Vision 2030 at the same time entail high hopes for future Saudi generations (Alajlan, 2016). The program presupposes various domains, targets, strategic objectives, commitments, and outcome-oriented indicators that should be achieved by private, public, and non-profit sectors in the country (Appendix 1). The banks have to adapt all their financial products and services to the needs of every sector.
Therefore, investigation of the ways that can help banks in Saudi Arabia improve their financial performance, customer loyalty, employee motivation, commitment to work and reputation, as well as contribute to help the Kingdom of Saudi Arabia to achieve 2030 vision and other future development plans, is particularly essential. It can be effectively conducted through the increased focus on the CSR. Hence, there is also the need to examine the involvement of banks into CSR and their desire to contribute to the prosperity of society.
Undoubtedly, the national standing of a country, its competitive position, and the well-being of its citizens are closely related to the challenges associated with the technological development, environment, social prosperity, and competency (Ali & Al-Aali, 2012). However, these challenges can only be effectively managed through the corporate initiatives (Scott & Arias, 2011). The broad CSR perspective is still not embraced by the financial institutions in the Kingdom. Therefore, this causes an increased need to explore various aspects of integrating CSR practices into business affairs and society and invite all types of organizations to contribute to the development of Saudi Arabia.
Hypothesis, Research Aims, and Objectives
The paper aims at investigating the relation between the financial performance, customer loyalty, motivation of employees, their commitment, reputation of the banks, their ability to achieve 2030 vision and other future development plans of the banks in Saudi Arabia. Additionally, it will analyze the Saudi Arabia financial system in order to improve it through focusing on the CSR of the Saudi Banks.
The research has the following hypotheses:
- Financial performance, customer loyalty, employee motivation, commitment to work, and reputation contribute to the achievement of 2030 vision and other future development plans by the banks in Saudi Arabia.
- The Saudi banks do not disclose much information about corporate social responsibility and they are not involved in it.
- The CSR in the banks of Saudi Arabia can be improved through the Saudi Arabian Monetary Agency and the Camels Rating System.
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In order to meet the research aims and objectives, the paper will focus on answering the following questions:
- How can the banks in Saudi Arabia improve their financial performance, customer loyalty, employee motivation, commitment to work, and reputation, as well as contribute to help the Kingdom of Saudi Arabia to achieve 2030 vision and other future development plans by focusing only on their social responsibility?
- Does Saudi Arabia have real Islamic banks that are clearly applying Islamic perspectives and values or do the banks just exploit Islamic religion and deceive people for their own benefits? If this is true, in which way has such practise affected banks, especially their social responsibility, as well as the Saudi people, community, and government?
- Why there is not enough information disclosed regarding the corporate social responsibility in the Saudi banks?
- How can we apply the Camels Rating System in the Saudi banks to achieve the transparency regarding their social responsibility activities?
- What is the role of the Saudi Arabian Monetary Agency toward the improvement of CSR in the banks of Saudi Arabia?
- How can we benefit from the successful global banks that have applied corporate social responsibility? How have they improved their financial performance, customer loyalty, and reputation by focusing on the corporate social responsibility?
Data Collection, Analysis and Evaluation of Data
The study will be conducted by applying primarily qualitative research methods. However, some elements of the quantitative approach will also be employed. The primary data will be colleted through the questionnaires with the bank managers while the secondary data will be obtained from reports, Internet resources, textbooks, journal articles, etc. In addition, the researcher will analyze the last tenyears annual reports provided by all banks in Saudi Arabia. It will enable to gain a clear understanding of the financial performance, customer loyalty, and other factors that influence the development services and goods provided by these financial institutions. Moreover, secondary data analysis will be utilized with the purpose to analyze the studies conducted by others. It will provide the researcher with an opportunity to analyze relevant data and findings received by other experts and address relevant questions.
For the study and record of the participants opinions, a specific questionnaire will be developed, in which the researcher will take into account all the necessary ethical considerations related to the data collection procedures. Small samples of the questionnaire will provide the opportunity to analyze the data from the questionnaire manually. The researcher will conduct the questionnaire with open-ended questions that will be not complicated for comprehension and will reveal the information revelant to answer the research questions (Appendix 2). However, in order to develop relevant questions, the researcher will be involved in observation and informal interviewing. A proper atmosphere during the interview will increase the data reliability as the participants will have the freedom to express their ideas and views concerning the issues under investigation.
Expected Results and Study Output
Although there is the market trend in the Saudi Arabian banking to convert to Islamic Banks, only a few of them in reality pursue Islamic values (Bintawim, 2011). Hence, the country does not officially recognize the concept of Islamic banking (Warde, 2010, p. 216). Evidently, Saudi Arabias Vision 2030 is a roadmap for economic and developmental action in the country that aims at granting the Kingdon of Saudi Arabia a leading position in all fields. In addition, it identifies the general policies, directions, aims, goals, and objectives, which means that some government entities, ministries, and institutions including banks, should undergo the process of restructuring (Gul, Irshad, & Zaman, 2011). Therefore, vision 2030 as well as other plans and programs will enhance the level and quality of services, increase sustainable development, and ensure a prosperous future.
In the Kingdom of Saudi Arabia, almost every aspect of life is associated with Islamic principles; consequesntly, religion contributes to the ways in which organizations perform their charity and philanthropic activities (Cone, 2003). The concept of CSR is considered to be relatively new in the country as it directs the orientation on the Western expression of corporate behavior (Alper & Anbar, 2011). However, the importance of CSR practice is constantly growing in Saudi Arabia (Looney, 2006).
Vision 2030 includes but is not limited to the following programs: the strategic direction program, the government restructuring program, the fiscal balance program, the project management program, the human capital program, and the performance measurement program. Besides, it presupposes the regulations review program, the Saudi Aramco strategic transformation program, the national transformation program, the privatization program, the public investment fund restructuring program, etc. (McAuley, 2016). The achievement of the mentioned programs and other plans is the first step in fulfilling Saudi Arabias Vision for 2030.
To summarize, the local banks can improve the situation with the CSR with the aid of the Saudi Arabian Monetary Agency and the Camels Rating System. Increased involvement of the Saudi banks in CSR practices will lead to the enhancement of their financial performance, customer loyalty, employees motivation, commitment to work, and reputation, as well as contribute to attainment of 2030 vision and other future development plans.
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