Royal Commission Report and Freedom Insurance

CORPORATE GOVERNANCE
AND ETHICS

ROYAL COMMISSION REPORT AND FREEDOM INSURANCE 1
Executive Summary
The ethical principles form an essential characteristic of the conduct of the
business of the modern business organisations in the light of the wide range of
stakeholders groups and need of transparent reporting combined with efficient
business practices. The recent Royal Commission formation, inquiry, reporting, and
recommendation in the insurance, superannuation and banking industry of Australia
accords the same.
The work highlights the chief responses of the Royal Commission and
explains the same in the light of the ethical theory of deontology, which stresses on
the performances of duties by the entity rather than the concentration on the results.
The later segment of the work also sheds light on the APES 110 Code of Ethics for
professional accountants that are employees in public entities.

ROYAL COMMISSION REPORT AND FREEDOM INSURANCE 2
Table of Contents
Introduction............................................................................................................................ 2
Background of Royal Commission inquiry into ethical misconducts.......................................2
Royal Commission response..................................................................................................3
Evaluation of the Royal Commission response in light of ethical theory of Deontology..........4
Freedom Insurance Case Study.............................................................................................5
Conclusion............................................................................................................................. 6
References............................................................................................................................. 7

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Introduction
The term ethics is referred to as the discipline that or the moral belief that
influences the behaviour, attitudes, and philosophy of a group of people. The term is
all-pervasive and applies to various professions and organisations of the society
irrespective of size and nature (Norman, 2013). Over the years, the business
activities have become even more complex and technology driven. This leads to the
placing of a greater need of conduct of business in a manner that is consistent with
the societal wellbeing, environmental wellbeing and the consideration of various
aspirations of different stakeholders groups (Barry, 2016). Thus, a number of
statutes have been developed to oversee the conduct of the business organisations
and a number of national and international organisations are working in this regard.
One such organisation in the Australian business climate is the Royal Banking
Commission. Lately the regulator had initiated the inquiries against the companies in
the Banking, Superannuation, and Financial Services Industry for the misconducts in
the business operations. The following work is aimed to evaluate the
recommendations as stated in the concluding report of the commission, which was
filed with the Parliament on 4 February 2019. The recommendations would be
evaluated with the aid of the ethical theory of deontology. Further, the case study of
the company Freedom Insurance would be analysed in the light of the ethical
principles and the APES Code of Ethics as applicable on the professional
accountants.
Background of Royal Commission inquiry into ethical
misconducts
The Australian Government has been granted the power to establish the
Royal Commissions under the Royal Commissions Act, 1902; for the initiation of the
ad hoc inquiries in different industries and sectors of the Australian corporate climate
(Australian Government, 2019). The commissions are set up to conduct the inquiries
and forward the report thereon and these are not meant to resolve the individual
disputes. The Royal Commission into Misconduct in the Banking, Superannuation
and Financial Services Industry was set up on December 14, 2017 the Governor-