Institutionalising social responsibility

This initiative responds to government efforts to unleash the potential of Jordan’s economy. It focuses on improving various sectors by directing funding towards areas that can have the most significant social and economic impact. The primary goal is to enhance development and drive sustainable economic growth through socially responsible investments. The idea is to find a balance between profitability and social responsibility, creating a sustainable model that benefits both businesses and society.

There are two key takeaways from this approach. First, the banking sector is demonstrating its commitment to social responsibility by investing in areas that improve the quality of life for Jordanian citizens. These investments, particularly in healthcare and education, aim to enhance human capital and stimulate economic growth. A more educated and healthier population is more productive, and these investments contribute directly to the country’s long-term prosperity.

Second, the government's proactive stance highlights the importance of public-private partnerships. Such cooperation is essential for achieving sustainable development, and it proves that the government can work effectively with the private sector. This collaboration is not a new idea but one that should have been embraced by previous governments. As long as both parties share a commitment to development, there is no reason why these partnerships cannot drive significant progress.

From an economic perspective, corporate social responsibility is a tool for growth. When businesses invest in projects that benefit society, such as improving healthcare and education, they help boost the economy. For instance, better education leads to a more skilled workforce, which in turn enhances productivity and economic output. Similarly, improved healthcare results in a healthier, more effective labour force, contributing to higher efficiency across the economy. These benefits lead to higher wages, more job opportunities and overall economic growth.

To ensure the long-term success of social responsibility, it must be institutionalised. What if a fixed percentage of bank profits were allocated to this cause? What if startup projects were integrated into social responsibility efforts? By adopting global best practices in corporate responsibility, businesses can make social responsibility a core part of their strategy. This requires establishing clear regulations, transparent execution and strict oversight to ensure that these investments are used effectively. When businesses make social responsibility part of their ongoing operations, they help alleviate the pressure on governments, allowing them to focus resources on other areas. This leads to stronger infrastructure and a more stable economy overall.

Raed Mahmoud Al Tal is head of the Economics Department — University of Jordan- r.tal@ju.edu.jo