Corporate Governance, Corporate Culture and Corporate Behaviour

Corporate Governance, Corporate
Culture and corporate behaviour

Abstract
The essay presents the opinion that the Corporate Governance and Corporate culture help in
framing the organizational behaviour. The organization with an ethical corporate culture
promotes ethical behaviour. The essay presents the examples of AWB scandal and
Commonwealth Bank to show that the unethical corporate culture promotes corporate
misconduct. The claim made in this essay is also supported using literary sources. The ASX
guidelines will be followed in an organization in practice only if the laws are made strict. It
also provides a few recommendations which can be used to make these principles effective.

Table of Contents
Introduction................................................................................................................................4
Discussion..................................................................................................................................4
Corporate misconduct: the AWB’s Oil for wheat scandal.....................................................4
Corporate culture and corporate governance.........................................................................5
Royal Service Commission....................................................................................................6
Corporate misconduct by the Commonwealth Bank.............................................................7
Do these codes of conduct, corporate government frameworks and Corporation Laws
actually work?........................................................................................................................8
Conclusion................................................................................................................................10
Bibliography.............................................................................................................................10

Introduction
Corporate behaviour is considered critical for the success of any organization, both in terms
of maintaining relationships with the stakeholders as well as attaining financial success. The
corporate behaviour includes ethical codes of conduct, legal rules and social responsibility
principles (Graham, 2013). The corporate behaviour affects not just the shareholders and the
stakeholders of the company, but also the economy of the organization. A socially and
ethically responsible behaviour of the leaders in any business organization makes the
organization more sustainable (Black, 2001). This can be witnessed in the AWB’s “oil-for-
wheat” scandal where the director and chairman of AWB Limited failed to manage the
conduct of their employees regarding illegal sanctions and corruption. The essay will present
the view that the corporate governance is highly responsible for the corporate behaviour. The
organizations need to develop strict corporate governance principles which govern the ethical
behaviour of the employees within the organization and its related overseas operations.
Discussion
Corporate misconduct: the AWB’s Oil for wheat scandal
To understand the significance of a good corporate governance framework and good
corporate culture in framing a good corporate behaviour, it is necessary to understand the
impact of corporate misconduct. The AWB’s “oil for wheat” scandal is one of the greatest
examples of corporate misconduct (Frain, et al., 2013). The background of the incidence
dates back to the time period between 1993 and 2003 when UN established a program for
Iraq named as oil for food where the money received by selling oil in Iraq was put in an
escrow account and it was, later, used for buying wheat (SBS News, 2015). From 1999 to
2002, AWB was found to be involved in the act of making an illicit payment to the Iraq