Impact of Business Operations on Society and Environment

The assignment requires analysis of social accounting approaches utilized by companies, including reports from Danske Bank and Commonwealth Bank. The report also delves into stakeholder theory, corporate responsibility, and the role of governments in business and society debates. Specific references are made to books and journals, including 'Business and Society: Ethics, Sustainability, and Stakeholder Management' and 'The International Integrated Reporting Council'.

Business Society

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
MAIN BODY ..................................................................................................................................1
1. Identify and describe Commonwealth Bank and Danske Bank..............................................1
2. What are the differences are evident between Commonwealth and Danske Bank................2
3. Sustainable Development Goals of Commonwealth and Danske Bank. ...............................3
4. Social accounting approach utilized by Commonwealth and Danske Bank as per Zadek
et.al.'s criteria..............................................................................................................................4
5. Social Reports provided by Common Wealth and Danske Bank reflect there values............5
6. Reflection and conclusion.......................................................................................................5
REFERENCES................................................................................................................................7

INTRODUCTION
In society business is the cornerstone of prosperity. In order to develop as well as for the
welfare of society, companies create resources. There is a great impact of society on businesses
as it influences the decision of customers, employees, competitors and suppliers whereas the
operation of companies affect society, environment and government (Carroll & Buchholtz,
2014). In this report, the entire description is about business society in Australia. Commonwealth
Bank of Australia and Danske Bank are chosen in this assessment. Both are banking industries in
Australia. This report will identify and describe the activities of business of both the companies.
Furthermore, this report will also discuss sustainable development goals that are relevant to both
organisations. Apart from this, various approaches of social accounting will also be included in
this assignment.
MAIN BODY
1. Identify and describe Commonwealth Bank and Danske Bank.
Both the companies are of banking industries. Commonwealth Bank (CBA) is a
multinational bank which has businesses across New Zealand, United States, Asia and United
Kingdom. It is public limited company traded as ASX: CBA. It was founded in year22
December 1911 as a government bank and in 1997 as public company by Australian Government
and in 1966 it was fully privatised. It is one of the big four banks of Australia. The chairman and
CEO/ Managing Director of bank is Catherine Livingstone AO and Matt Comyn respectively. Its
headquarters are located in Darling Harbour, Sydney, Australia. More than 1100 branches are
operating in the world. Commonwealth Bank has opened up about 4300+ ATM. About 51,800
employees are workers in this company in 2017. Its revenue is about A$26.005 billion in 2017.
Commonwealth Bank provides variety of financial services including institutional banking, retail
business, management of fund, superannuation insurance, broking as well as investment services
(Polman, 2014). It is one of the largest company listed on the security exchange board of country
in 1991.
Danske Bank is an Akitieselskab (either private or public) type organisation. It is called
as Danish Bank as its name was literally translates into Danish Bank and it was founded in 5
October in 1871. The chairmen and CEO of Danske Bank is Ole Andersen and Thomas F.
Borgen respectively. Its headquarters are located in Copenhagen, Denmark. Its revenue is about
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DKK 47.959 billion. More than 19000 employees are employed in Danske Bank. It is one of the
largest bank in Denmark as well as a major retail bank in northern European region. It has more
than 5 million retail customers in Denmark. On the Future Global List of 2011, Danske has 454
number. So many local banks are operated by Danske Bank around Nordic Region as well as
across Ireland (Doppelt, 2017).
2. What are the differences are evident between Commonwealth and Danske Bank.
Commonwealth Bank and Danske Bank both are contributing large to the society.
According to their CSR report, it was identified that both have appreciable contribution in the
society. In the recent report of Commonwealth Bank, it was stated that billions of fund is given
for the welfare and betterment of society. They find issues in society about literacy and women
rights. They make huge investment in providing education to children and youth. They started
education programmes and it was the biggest financial education program. The management of
company found that people does not have management skill (Corporate Responsibility Report of
Commonwealth Bank, 2017). It is not new that Commonwealth Bank has contributed investment
in education as they are investing since 85 years ago. Apart from this, they also contribute large
amount of fund in the rights of women. It was found that more than 45% employees are female
workers and they are playing the roles of managers. They have noticed that women's does not
have equal rights as compare to men's. Beside all these, they also find the issues related to
customer experience. It includes protection, satisfaction and remediation. Company is
overcoming or solving this issue by providing annual reports publicly as well as CSR Report for
them (Jones, Wicks & Freeman, 2017).
The CSR report of Danske Bank is also very good as they are also contributing large to
society. They always make their goals as per the norms and standard that needs to be fulfilled.
They always focus on furnishing betterment and welfare of the society. They find the issues in
customer satisfaction, welfare of society as whole and effective environment. They always make
balance between economic growth and in financial stability that results in solving the issues that
are coming in society. In order to satisfy their customers, they have provided DKK1,723 billion
fund in terms of loans in 2017 so that customers can utilize those funds where they needed. Apart
from this, they identify the issues related to environmental like lack of plantation in the society.
Thus, in order to solve the issue that have invested fund in environmental protection and anti-
corruption (Corporate Responsibility Report of Danske Bank, 2017).
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Comparing Commonwealth and Danske Bank.
Both companies’ Consolidated Financial Statements are very factual list of numbers, with
no commentary at all. The PR takes place in their respective Code of Ethics and Corporate Social
Responsibility report (Commonwealth Bank) and Corporate Business Principles and creating
shared value report (Danske). Principles that outlines the culture and value and belief are used by
both the companies. They are highlighting their commitments to sustainable corporate social
responsibilities (Lawrence & Weber, 2014).
But still there are some differences like Commonwealth Bank are investing more for the
development for society as they are more concern about what is right and wrong going in the
society as compare to Danske Bank. Commonwealth Bank is focusing on each and every small
aspects of society like on women's, education and all, on the other hand, Danske is working for
society as in general context like giving better customer satisfaction as a whole.
Strength according to Social Reporting evident of Commonwealth Bank are Its financial
condition is sound; thus CSR report is also good. They are on Investing on Women's rights as
they employed 44% women's as manager in the organisation. Further, they are also investing
fund on the education of children's and youth. On the other hand, Strength according to Social
Reporting evident of Danske bank are there financial statements are also sound, thus they set
aside the fund for society welfare. There Investment in society welfare and development in CSR
report is appreciable.
Weaknesses according to Social Reporting evident of Commonwealth bank are Lack of clearly
formulated goals as some time it has been seen that there goals are not clearly defined. Apart
from this there rate of lending is very high effect society at large and demotivate people. Beside
this, Weaknesses according to Social Reporting evident of Danske bank are they do not focus on
small needs of society like women's rights. Another weakness is low capitalization which also
sometimes hinders there investment.
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3. Sustainable Development Goals of Commonwealth and Danske Bank.
Sustainable development goals are the collection of 17 global goals set by the United
Nations Development Programme. The main purpose of sustainable development means
transforming the world. From all 17 goals there are some goals that are common for both
companies and country as well as best objectives for both banks and countries. First is end of
poverty in all its forms everywhere, this is fundamental goal that is very essential for Australia
and Denmark. In order to work for society and for sustainable growth of country, it is very
important that poverty should be remove. Commonwealth and Danske both banks are organizing
programmes for the welfare of society that are assisting large in reducing poverty such as
education programmes, women's employment etc. Secondly, in order to develop the growth rate
of Australia and Denmark, it is very essential to make sure that people have healthy lives and
promote well-being for all at all ages. Life without health is nothing, company cannot achieve
anything if there are no healthy lives among society. Addition to this, gender equality is also very
important for company and country to develop. In Australia there is high discrimination so, it is
very important for Commonwealth Bank to work on this goal so that there is essence of equality
among the people. Danske Bank can also make this goal for sustainable development of
Denmark in the future (Macaulay, 2018). Moreover, the another goal that is best for both the
banks is they should build resilient infrastructure so that in Australia and Denmark will have
healthy and effective economic growth rate. Commonwealth Bank should give more
employment opportunities to people in Australia so that unemployment rate should be control
which result in economic growth. Moreover, another than that Danske Bank and Commonwealth
company both make goals to reduce inequality among people living in country. Commonwealth
Bank has policy of taking urgent action on compact change in climate and its impact on the
country so that economic rate is not disturbed and mismanage (Dahan Doh & Raelin, 2015).
These all goals that were discussed above are addresses in the CSR report of both the companies.
Among 17 goals, Commonwealth Bank is using some goals of SDG's and Danske Bank also
formulate their goals and objectives as per the Sustainable Development Goals.
4. Social accounting approach utilized by Commonwealth and Danske Bank as per Zadek et.al.
criteria.
There are eight principles that are given by Zadek in his book of Social Accounting
approach which are inclusivity, comparability, completeness, evolution, management systems
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and policies, disclosure, external verified and continuous improvement. There are some
principles that are utilized by both companies and they work in the designed framework for
quality. Here are some principles followed by Commonwealth Bank are as follows-
 Comparability- This is the important principle that Commonwealth Bank is
utilizing in their practices. This principle states that the performance of
organisation should be measure or compare by other companies. (Grayson &
Hodges, 2017).
 Disclosure- This principle states that conflict or battle in between internal
management and external audience required to determine the extent and nature of
disclosure. Commonwealth never ever hide anything from audience, they used to
disclose each and everything straight.
Apart from that there are some principles that are utilized by Danske Bank are as follows-
 Completeness- According to this principle no areas of the activities of
organisations can be systematically and deliberately excluded from the
assessment. Danske Bank never leave the work or activity incomplete; they
always complete the work or activities in the best possible manner.
 Management system and policies- According to this principle organisational
learning requires policies and systematic procedure that covers each and every
area as well as the process of accounting itself. Danske Bank has systematic
procedure and well-defined policies that makes easy and simple way of
functioning (Dentchev, Haezendonck & van Balen, 2017).
Continuous improvement is another principle that is used by both the organisations as
according to this principal aim to assess progress instead of retrospective performance. Both the
banks are continuously moving on the path of growth and development.
5. Social Reports provided by Common Wealth and Danske Bank reflect their values.
The social reports that are provided by both the banks i.e. Commonwealth and Danske
banks reflect their values, there mission vision and goals. The mission and vision of
Commonwealth bank is to maintain and create environment that are healthy, efficient and safe
while protecting the financial health of investors. Apart from this, the mission and vision of
Danske Bank is to become the most trusted financial partners as wells as to become one of the
best banks in Nordic region. They are working at large in gaining of trust of there customers,
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society and investors at large. Thus, the above mission and visions of both the bank reflect that
there are not focusing on increasing profit but they are doing for society too. Values are very
important as it helps company to grow and develop more. Social values have a huge potential to
change the way one understand the world around us. Values are very important as it informs the
ideas, thoughts, actions and words. The social reports that were presented by Commonwealth and
Danske companies are adorable as they both have the highest contribution in the welfare and
betterment of society. The decision for the welfare of society reflect their values (Crane, 2015).
As it was discussed above that Commonwealth company has immense contribution in betterment
of society like they are organizing education programs for children's and youth which reflect that
they are very concern about the people. Further, it was also noted from the CSR report that
company has immense contribution in women's rights this also shows how they are concern
about community. On the other hand, Danske Bank also have appreciable contribution for the
society that reflects their mission and vision of company.
The social reports that are prescribes by both the banks are aligned as they are not only
showing contribution for society but in real term they are investing at large. Millions of fund are
invested for the development and welfare of society by both the banks that reflect there values
and mission and vision.
6. Reflection and conclusion.
From the above conclusion, I realize that society plays a crucial role in companies’
growth and development. Both the companies i.e. Commonwealth and Danske Bank create
resources in order to develop as well as welfare for society. Common wealth bank has more
contribution in the welfare and betterment of society as compare to Danske. But still Danske has
also a good investment in the society welfare. Danske Bank is smaller than compare to
Commonwealth Bank. In my group discussion, there are various views and opinions about
company. Some people said that Commonwealth Bank is much better than Danske and some
said Danske Bank is much better than Commonwealth Bank. Apart from this, there are some
principles of Social and ethical accounting that plays a vital role in the development and growth
of company (Moore, 2016). Some people said that Commonwealth Bank should invest more to
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the society as revenue is very high as compare to Danske. There are some reviews come that they
should make their goals according to sustainable development so that it will fulfil both the
aspects of company and country (Adams, 2015).
Further this report concluded that here is a great impact of society on businesses as it
influences the decision of customers, employees, competitors and suppliers whereas the
operation of companies affect society, environment and government. Moreover, this report has
make understood goal related with sustainable development of country and company. Social
accounting approaches is utilized by both companies was also included in this assignment.
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REFERENCES
Books and Journals:
Adams, C. A. (2015). The international integrated reporting council: a call to action. Critical
Perspectives on Accounting, 27, 23-28.
Carroll, A., & Buchholtz, A. (2014). Business and society: Ethics, sustainability, and stakeholder
management. Nelson Education.
Crane, A., Henriques, I., Husted, B. W., & Matten, D. (2016). What constitutes a theoretical
contribution in the business and society field?. Business & Society, 55(6), 783-791.
Crane, A., Henriques, I., Husted, B., & Matten, D. (2015). Defining the scope of Business &
Society.
Dahan, N. M., Doh, J. P., & Raelin, J. D. (2015). Pivoting the role of government in the business
and society interface: A stakeholder perspective. Journal of Business ethics, 131(3), 665-
680.
Dentchev, N. A., Haezendonck, E., & van Balen, M. (2017). The role of governments in the
business and society debate. Business & Society, 56(4), 527-544.
Doppelt, B. (2017). Leading change toward sustainability: A change-management guide for
business, government and civil society. Routledge.
Grayson, D., & Hodges, A. (2017). Corporate social opportunity!: Seven steps to make
corporate social responsibility work for your business. Routledge.
Jones, T. M., Wicks, A. C., & Freeman, R. E. (2017). Stakeholder theory: The state of the
art. The Blackwell guide to business ethics, 17-37.
Lawrence, A. T., & Weber, J. (2014). Business and society: Stakeholders, ethics, public policy.
Tata McGraw-Hill Education.
Macaulay, S. (2018). Non-contractual relations in business: A preliminary study. In The Law and
Society Canon (pp. 155-167). Routledge.
Moore, J. F. (2016). The death of competition: leadership and strategy in the age of business
ecosystems. HarperCollins.
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Polman, P. (2014). Business, society, and the future of capitalism. McKindsey, May.
Online
Corporate Responsibility Report of Danske Bank, 2017. [Online]. Accessed through:
<https://danskebank.com/-/media/danske-bank-com/file-cloud/2017/2/cr-report-2016.pdf>.
Corporate Responsibility Report of Commonwealth Bank, 2017. [Online]. Accessed through:
<https://www.commbank.com.au/guidance/newsroom/2017-Corporate-Responsibility-
Report-201708.html>.
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