Impact of Corporate Social Responsibility (CSR) on Customer Loyalty:Evidence from the Banking Industry in Bangladesh

Abstract

Corporate social responsibility (CSR) has become more critical in developing nations such as Bangladesh, where customers, communities, and governments expect companies to be more responsible. Here, financial institutions, most notably banks, need to know how CSR activities affect customers' behavior and loyalty. This research examines the effect of four CSR aspects— customer-centric initiatives, environmental responsibility, ethical practices, and philanthropic activities —on customer loyalty within the banking industry of Bangladesh. Primary data were collected from 400 respondents through face-to-face and web surveys from city corporation locations. Factor analysis confirmed the constructs, while regression analysis showed that all CSR dimensions play a significant and positive role in shaping customer loyalty. Ethical practices had the greatest impact and environmental responsibility had the least impact. These findings highlight the strategic relevance of CSR for building customer loyalty and institutional reputation. The study suggests that banks should prioritize ethical and customer-centric CSR activities more to form long-run relationships with customers and achieve sustainable growth.