Comparative Business Ethics and Social Responsibility

This essay discusses the ethical issue confronted by two largest lenders in Australia, Commonwealth Bank of Australia (CBA) and Australia and New Zealand Banking Group (ANZ), and their decision-making process. It covers the identification of the business ethics issue, collection of relevant information, evaluation of collected information, consideration of different alternatives, and decision making using moral philosophy.

Running Head: BUSINESS ETHICS 1
Comparative Business Ethics and Social
Responsibility

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Introduction
Business ethics are the moral principles which guide the manner in which a business behaves.
The similar principles which determine the actions of individuals also implement to the business.
Working in an ethical manner includes differentiating between wrong and right and then
choosing the right one (Shaw, 2016). Comparatively, it is easier to recognize the unethical
business practices. Ethics are basically related to the moral judgments of a person about the
wrong and right. In any organization, business ethical problem can direct its employees to take
immoral decisions due to different obstacles. For this essay, a news article about Commonwealth
Bank of Australia (CBA) and Australia and New Zealand Banking Group (ANZ) is taken into
consideration. This article about business ethics issue is recently published in “Sydney Morning
Herald News” in Australia. It is named as “CBA and ANZ caught in fake banking apps scam”
that depicts the ethical issue that is confronted by two of the largest banks of Australia.
As per a European Security Company, CBA and ANZ have been caught up in the fake banking
applications scandal. The selected article depicts that fake applications for ANZ and CBA were
among many false Android apps which tried to copy the personal banking apps of 6 banks in
Britain, New Zealand, Australia, Poland and Switzerland (Hendy, 2018). The selected news
article states that customers of the biggest Aussie banks have fallen victim of a wily scam
targeting the banking applications on mobile phones. It is a big issue for everyone who may have
given personal information on these applications. This essay includes the discussion about the
ethical issue confronted by two largest lenders in Australia. It discusses major arguments of this
problem in addition to most appropriate ethical decisions. In the last section, it covers ethical
decision making procedure that assists company’s decision by determining the linked ethical
philosophies.
Business Ethics Issue and Decision
As per the report of a European Company, more than thousand back customers have innocently
downloaded the malicious applications copying legitimate CBA and ANZ from Google Play
Store. Before this malfunction was discovered, some innocent users were revealing their personal
information, log-in credentials and credit/debit card details to those fraudsters. All of these fake
applications were via Google Play Store and customers of these banks have been advised to

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check their account balances and statements. It is a big ethical issue for anyone who has given
the personal information and log-in credentials (Hendy, 2018). The theft of personally
recognizable data can result in the financial fraud which may impact the individuals for the rest
of their life adversely.
In this case, three parties are playing important role such as Commonwealth bank, ANZ and
Google. In this context, the spokesperson of Google denied to give any information about this.
He stated that that company removes the apps which violate their policies and terms.
Additionally, he said that their team does not comment on individual apps. Moreover, the
spokeswoman of CommBank stated that security of banking details of customers is its first
priority. Proactively, the bank monitors the app stores and utilizes the feedback of customer to
find out the possible security risks for customers (Iphofen, 2016). Once a doubtful application is
recognized, the bank works with the app store to disable or remove that app. Additionally, ANZ
spokeswoman said that their bank was continuously supervising the fake apps and security
scams.
By reading the selected article, it can be evaluated that the customers of these banks have faced
the ethical issues which are related to the personal information leakage and security breach
(Crane and Matten, 2016). In this new article, the major arguments are that both of the banks are
under controversy because both the apps asked their over thousands of customers about their log-
in and credit card details. The major goal of fake applications is to get sensitive data from
unsuspecting customers. One of the major arguments in this case is that the banks were not able
to identify the issues which the customers were facing. In the reply of this allegation, the banks
made an argument that they are very much concerned about the security of customers’
information. The bank argued that it offers the advantages from its 100% Security Guarantee
over unauthorized transactions where the people are not at mistake. In this context, ANZ stated
that in June 2018, the bank become aware about fraudulent application through a customer. This
app was named as ANZ PayOnGo that was being marketed on Google Play. After that, the bank
worked with the team of Google Play Store to remove the app in a few hours (Chung, 2018).
In addition to this, it is found out that the applications with less functionality are considered less
risky and provided fake bank apps which only asked the customers to log in and asked for their
log in and credit card details, they looked to have fallen through. These apps utilize obfuscation

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that may contribute to them tripping into store unnoticed (Ni and Van Wart, 2015). This scam
comes outside the Notifiable Data Breaches Act launched in January as these banks were
imitated not hacked. The article shows that somewhere the banks were not able to follow the
laws and principles of security and privacy. Due to this, both of the banks were gone under
investigation as it is supposed that they breached Data Protection Laws.
In this way, CBA and ANZ were failed to maintain the confidential data of its customers. This
business ethics issue is relevant to corporate social responsibility as it has affected the trust and
integrity between banks and their customers (Kolk, 2016). It is the moral responsibility of banks
to secure the data of its customers but customers lost their personal information from these fake
apps. This is the reason that CBA and ANZ need to make more efforts to secure the customers
data. They need to be updated by the information and these types of frauds. Indirectly, these
banks were unable to meet their responsibilities towards its customers.
To respond this ethical issue, the banks underwent an investigation where it is found that it is the
not the fault of banks. The firms have made some specific decisions to overcome this issue and
retain customers (Weiss, 2014). Both of the banks have issued the guidelines and contact
numbers for the customers who have faced the problems due to fake banking apps. The below-
given suggestions are given by both of the banks:
 The customers of CBA can report about suspicious mobile applications on 13 2221.
 Customers of ANZ should contact with their bank instantly if they think that they have
downloaded a fake application on 1800 033 844 (Hendy, 2018).
 Additionally, customers should immediately change the pin codes of their credit card, net
banking passwords and check the accounts for the doubtful activity. If they find any
strange transactions contact the nearest bank branch.
In addition to this, the banks have issued a guideline that guides that how the customers can
avoid falling victim to phishing and fake banking applications. From the analysis, it can be stated
a good decision but it could be better if banks have taken some actions against the fraudsters.
They need to make the customers understand that customers’ information is one of the most
important assets to safeguard. It is their first priority to protect the log in credentials and credit
card details of customers (Chung, 2018). Moreover, the banks could improve its decisions by

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issuing the privacy and security standards and principles so that no one can impersonate its
services and authorized information.
Previously, there are various examples from real world companies that have confronted the
similar business ethics dilemmas. In this context, the most current case is of Facebook Company
which also confronted the problem of privacy theft of its 50 million users. To eliminate this
ethical problem, the company has issued security principles and limited the use of applications
developers. Same as Facebook, Sony Company has been penalized with £250 after it found
guilty of not complying with industry’s data protection act. The organization was not able to
utilize its security software properly (Trevino and Nelson, 2016). In order to resolve this
problem, Sony has adopted strict privacy standards to protect itself from this type of issues.
Ethical Decision Making Process
To overcome the above ethical issue, a systematic ethical decision making process can be used.
This decision making process includes different steps including ethical and moral philosophy
that both banks can adopt to take decisions on above-mentioned business ethics issue (Ferrell and
Fraedrich, 2015). This ethical decision making procedure is given below:
Identification of Business Ethics Issue
This is the first step to recognize the business issue that is faced by the organization. In the above
case, it has been revealed that CBA and ANZ have faced the issues of fake banking applications.
The banks have lost the public trust and integrity in the services of financial institutions. Fake
CBA and ANZ bank apps have been found on Google Play Store and it has left the people
susceptible to wicked activity (Chung, 2018).
Collection of Relevant Information
After recognizing the issue, an investigation is conducted when the customers informed that
some fraud apps are gaining their personal information and log in credentials. At this step, it is
found that both the banks were impersonated not hacked. This data is used to approach the most
suitable decision.
Evaluation of Collected Information

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The collected information is evaluated with the support of regulators, information security
department and legislators (Saha, 2015). It assists the banks understand the reason about the
major reason behind fraudulent activities.
Consideration of Different Alternatives
The case was discussed with the IT experts and the management team of CBA and ANZ banks
(Hartman, DesJardins and MacDonald, 2014). This stage assists in establishing the privacy and
security principles and publishing the guidelines regarding the usage of banking apps.
Decision making using Moral Philosophy
After analyzing all the above alternatives, the banks will analyze all the alternatives and choose
the most suitable decision under this step. Under this step, the organizations can use the ethical
philosophy of deontology (Broad, 2014). It is a moral concept which showcases the normative
stage and determines goodness of the procedure considering the applied regulations and rules. It
can be described as a commitment which connects the entity to its roles and duties. According to
this theory, it is the responsibility of CBA and ANZ to protect the private data of its customers.
The organizations need to follow the laws and principles of data protection (Monteverde, 2014).
Conclusion
From the above analysis, it can be concluded that modern organizations need to emphasize on
following all the regulations and rules which are implemented on the business. This essay
assesses the business ethics issue which is confronted by the customers of CBA and ANZ in
Australia. In the above case, the customers have faced the issue of losing their log in and credit
card credentials. It is found that both the banks should make more efforts to increase security
measures so that they can store customers’ data safely. The private data of banks should be kept
privately so that fake apps cannot imitate it.

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References
Broad, C. D. (2014) Five types of ethical theory. UK: Routledge.
Chung. (2018) CommBank, ANZ hit with scam apps. Available from
https://www.news.com.au/finance/business/banking/commbank-anz-hit-with-scam-apps/news-
story/3823b667c1acbd138e9c12c29ef9adfe [Accessed on 28 Sep. 18].
Crane, A. and Matten, D., (2016) Business ethics: Managing corporate citizenship and
sustainability in the age of globalization. US: Oxford University Press.
Ferrell, O. C., and Fraedrich, J. (2015) Business ethics: Ethical decision making & cases.
Canada: Nelson Education.
Hartman, L.P., DesJardins, J.R. and MacDonald, C., (2014) Business ethics: Decision making for
personal integrity and social responsibility. New York: McGraw-Hill.
Hendy, N. (2018) CBA and ANZ caught in fake banking apps scam. Available from
https://www.smh.com.au/money/banking/cba-and-anz-caught-in-fake-banking-apps-scam-
20180919-p504si.html [Accessed on 28 Sep. 18].
Iphofen, R., (2016) Ethical decision making in social research: A practical guide. Springer.
Kolk, A. (2016) The social responsibility of international business: From ethics and the
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Monteverde, S. (2014) Undergraduate healthcare ethics education, moral resilience, and the role
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Ni, A. and Van Wart, M., (2015) Corporate Social Responsibility: Doing Well and Doing Good.
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Saha, B. (2015) The analytical study of the application of the ethical theories in the business
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3351, 1(3), 28-31.
Shaw, W.H., (2016) Business ethics: A textbook with cases. Nelson Education.

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Trevino, L.K. and Nelson, K.A., (2016) Managing business ethics: Straight talk about how to do
it right. John Wiley & Sons.
Weiss, J. W. (2014) Business

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ethics: A stakeholder and issues management approach. Berrett-Koehler Publishers.

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Appendix:

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