Royal Commission & Commonwealth Bank

This assignment examines the Australian government's decision to launch a Royal Commission into the finance sector, particularly focusing on its potential impact on the Commonwealth Bank (CBA). It analyzes arguments for and against the commission, explores its powers and potential consequences for CBA, and discusses expert opinions on its effectiveness. The analysis considers public perception, whistle-blowing events, and the broader context of financial scandals within Australia.

Commonwealth Bank to face ‘Royal’ heat!
The Malcolm Turnbull government announced Royal Commission inquiry into the
Australian finance sector just a month before Christmas. The announcement was made after the
‘big four’ banks of Australia sent a letter of approval supporting the inquiry. The decision to
introduce a commission came because of Mr. Turnbull succumbing to the pressure of the
opposition and members of Coalition. The inquiry is most likely to affect the operations at the
Commonwealth Bank.
However, a good part of the population believes that the Royal Commission is just an
excuse to waste money that comes out from the wallets of the common citizens. Former Prime
Minister John Howard conveyed strong resentment towards Royal Commission stating it is
nothing but “rank socialism”. He had even requested the Nationals not to go ahead with the
demand for an inquiry. Commenting on the impact the Royal Commission would have on CBA;
many experts believe that it would hardly have any effect on the bank, as there is nothing left to
investigate. They have even provided strong evidences that further strengthen their position. One
instance is that of the Australian Prudential Regulation Authority’s (APRA) ongoing
investigation into the corporate culture of CBA. These investigations, believe experts are far
more vital than the Royal Commission as it would influence the corporate structure of CBA. The
Royal inquiry would take a toll of around A$75 million, which is huge in terms of inquiry.
According to several reports, demands for the Royal Commission were raised three years
prior, to inquire the financial scandals occurring at the Commonwealth Bank. Many believe that
the announcement was a result of the whistle-blowing episode that put the Commonwealth Bank
in a vulnerable position. Airing his views after the big announcement, opposition leader Bill

Shorten commented that the Prime Minister “has always been and will be on the side of the
banks”, referring to the Prime Minister’s reluctance in introducing Royal Commission into
banking sector. Supporting the Royal Commission, Mr. Shorten further stated that the inquiry
would “get to the heart” of the corruption at CBA. A better understanding of the powers and
authorities of the Royal Commission counters the doubts raised by its opponents regarding its
impact. Among its many powers, the commission can authorize the police to search for
evidences and detain witnesses as well. All CBA employees will be under the commission’s
radar. Along with the core investigation into the matter, the commission would also be able to
examine the seriousness of CBA in terms of adhering to its corporate responsibility. Moreover,
the elaborative inquiry by the Royal Commission would bring to light, the failure of the
Commonwealth Bank to abide by its ethical code of conduct.
Breaking the trust of the common citizens who put their money and their faith at the
hands of the big corporate is a serious crime that goes unnoticed. A royal inquiry reinstalls this
faith and allows for a transparent inquiry without corporate influence. The inquiry sets out a
warning to other individuals and organizations engaged in corrupt practices to mend their ways.

Bibliography:
Banking royal commission to get under way. (2018, January). SBS News. Retrieved from
https://www.sbs.com.au/news/
Commonwealth Bank admits to failures in money-laundering case. (2018, January). The
Guardian. Retrieved from https://www.theguardian.com/australia-news/
Ryan, P. (2018, August 4). CBA in damage control over anti-money laundering allegations. ABC
News. Retrieved from http://www.abc.net.au
Theconversation.com. (2018). Broad mandate for financial services royal commission takes the
heat off banks. The Conversation. Retrieved 31 January 2018, from
https://theconversation.com/broad-mandate-for-financial-services-royal-commission-
takes-the-heat-off-banks-88391