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Stakeholders Analysis of Commonwealth Bank's Ethical Scandals and Role of Public Relations in Crisis Management

   

Added on  2023-06-08

11 Pages3341 Words165 Views
Public relation
Stakeholders Analysis
Name of the Author

Table of Contents
INTRODUCTION.................................................................................................................................1
ANALYSIS OF THE CAUSE OF REPEATED ETHICAL SCANDALS THROUGH THE LENS OF
PR THEORIES & PRACTICES............................................................................................................1
STAKEHOLDER ANALYSIS..............................................................................................................2
IMPACT ON IMAGE/BRANDING.....................................................................................................3
ANALYSIS OF EXISTING BARRIERS AT THE CHOSEN BANK..................................................4
ROLE OF PUBLIC RELATIONS IN MANAGING THESE CRISES.................................................4
PRESS RELEASE.................................................................................................................................5
RECOMMENDATIONS.......................................................................................................................5
CONCLUSION.....................................................................................................................................5
REFERENCES......................................................................................................................................6

INTRODUCTION
With the changes in technologies and economic conditions, each and every
organization needs to take proper public relation to strengthen the branding and ethical
busienss frameworks in long run. The following report deals with the analysis of a series of
ethical scandals that has shattered the image of the Commonwealth Bank of Australia (CBA).
In this report, in order to analysis the public relation, and its ethical scandals impacts on
public, the business functioning of Banks have been taken into consideration. The reasons
behind such scandals are analysed. The stakeholder analysis is made and the impact of the
same on the image and branding of the bank is observed. Apart from the scandals, the
existing barriers at the Commonwealth Bank are also examined. The public relations role to
manage these crises has been observed. Further in the report, a press release for the
shareholders is also prepared. In the end of the report before concluding statement, certain
recommendations are put forward to make the commonwealth bank more ethical and to
enhance the quality of the corporate social responsibility of the organisation.
ANALYSIS OF THE CAUSE OF REPEATED ETHICAL SCANDALS THROUGH
THE LENS OF PR THEORIES & PRACTICES
Commonwealth Bank of Australia has its business spread across New Zealand, Asia,
the United States and the United Kingdom. It is a multinational bank providing a variety of
financial services including, retail, business and institutional banking, fund management,
superannuation, insurance, investment and broking services. As of August 2015, the
Commonwealth bank is the largest Australian listed company on the Australian Stock
Exchange. Even after being such a reputed bank, the commonwealth bank is accused to have
been involved in certain scandals involving, bribery, forgery, breaching money laundering
laws, a failure to provide advertised fee waiver, fees-for-no service scandal, unethical
behaviour to avoid CommInsure insurance payouts (Wæraas, 2018).
The most burning scandal seems to be that of money laundering which has blown off
all the ethical requirements excepted out of the bank’s board. The money laundering acts not
only mitigate the bribery cases and other insider trading acts but also increase the ethical
public relation. The whole case revolves around the intelligent deposit machines, which are
a type of Automated Teller Machines (ATM) that were launched back in 2012. Through these
machines, the customers get a privilege to avail banking services like cash deposition and

transfer, even on the days when banks are closed. The reason put forward as per the research
was the inability of the bank to take adequate steps to “mitigate and manage” risks even on
the hour when it had come to the knowledge of the bank that these intelligent machines were
being used for suspected cases of money laundering. The Australian Transaction Reports and
Analysis Centre (AUSTRAC), Australian government financial agency have
successfully alleged that four money laundering syndicates, including three linked to drug
importation and distribution networks used these machines to deposit and transfer cash. They
made this tricky by keeping the amounts low to eliminate any kind of suspicion. $21 million
was deposited into 11 Common Bank accounts in a period of February 2015 to May 2016,
which was almost through the intelligent machines. This was observed by the money
laundering operation and they further noticed that the bank had the knowledge of the
accounts to be suspicious as promptly as in May 2015 (Alyaqoub, and Rahman, 2018). This
money was believed to be the illegal proceeds of a drug importation scandal. But due to the
failure on the part of the bank to take legitimate steps in alerting the authorities for these
transactions and about the abnormal pattern that was taking place in certain accounts, this
activity was continued. It is analyzed that the public relation works and organization
effectiveness are measured by analysing the how company has been establishing the nexus
between the organizational growth and client’s development at large. This public relation
practice and undertaken work by the organization will be the useful tool in practice of
managing the spread of information among stakeholders and organization. However, banks
have used several marketing tools and followed transparent busienss practice to strengthen
the its pubic relation. There are several scandals in economy which have happened due to the
less effective public relation acts.
Even the back ignored the warnings of Australian federal police regarding the same.
The bank even didn’t close these accounts. The bank even allowed the international transfer
of the funds kept in these accounts. The monitoring of accounts is mandatory and the
commonwealth bank failed to comply with this requirement on 778,370 accounts over a
period of three years. Further there was a failure to provide 53,506 reports which are known
as threshold transaction reports to Austrac. These amounted to around 95% of the overall
threshold transactions between the time span of November 2012 to September 2015. As a
result of all that happened and discussed above, commonwealth bank was sued for some
53,700 breaches of money laundering and counter-terrorism-financing laws (Jo, Childers
Hon, and Brunner, 2015).

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