Business Ethics and Corporate Responsibility

This assignment requires students to analyze various case studies focusing on business ethics and corporate social responsibility. The cases involve diverse industries like mining, finance, and wine production, highlighting contemporary ethical dilemmas such as money laundering, climate change response, and workplace bullying. Students are expected to demonstrate their understanding of ethical principles, frameworks, and real-world applications within a business context.

Project on Ethics and
Codes of Conduct
Report

Table of Contents
EXECUTIVE SUMMARY.............................................................................................................1
INTRODUCTION...........................................................................................................................2
Business Ethics ...........................................................................................................................2
1. Case study...............................................................................................................................4
2. Case study...............................................................................................................................8
Comparison between above two case studies on business ethics:............................................10
CONCLUSION .............................................................................................................................12
REFERENCES..............................................................................................................................13

EXECUTIVE SUMMARY
This report summarizes various aspects of the topic Ethics and Codes of Conduct
Report by considering two case studies with respect to Australian rules and regulations related
to topic taken that is business ethics. With the analysis of two case studies, comparison
between both is also determined. Ethics and Codes of Conduct are set of principles and
procedures from which behaviour of business are guided. In former case study analysis
concentrates on presence of business ethics in various departments within company and also in
outside business environment. Latter case study focuses situations, conditions related to ethical
issues prevailing in Australia and New Zealand, after different types of ethics theories have
been explained.
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INTRODUCTION
Ethics the term of the investigation and analysis of moral principles and dilemmas. Mostly
religious scholars and philosophers have studied ethics. The scholars are related to various
fields and for the study of ethics creating new approaches, behavior ethics and applied ethics.
And code of conduct set of rules and behavior for an organization and for a group. In this
including religious rules and responsibilities, proper practice and outlining the social norms.
In this report selecting topic business ethics, it is a form of professional ethics and
applied ethics, that examines ethical problems, moral and ethical principles. These ethics
develop from organizational statement, individual or from legal system. On this topic covered
two case studies that are related to business ethics values and showing crisis. All the study of
business ethics is conducted by taking into consideration Australian businesses. This study is all
about stating importance of ethical behavior in every department of companies. As well as from
the point of view of social, cultural and environmental safety.
Business Ethics
In Australia, definition of business ethics not only includes fair and honest treatment of
customers by a company but also focuses on privacy of individuals, effective communication.
Ethical behaviour of business focuses on becoming honest, judging individuals on the basis of
knowledge and skills not on any other criteria (Su, H. Y., 2014). Australian business ethics
includes following:
Equality: Equality is most important for Australians as they do not prefer to show off
their achievements and looking different from crowd. Indicators for judgement are an individual's
abilities, skills, performance rather than personal power or influence.
Company Structure: According to this, every company has a specific hierarchical
structure that comprises upper level managers and lower level employees. In context of ethical
behaviour, there should not be misuse of authority by upper level and lower level employees
should also be provided substantial power of decision making. As upper level managers take
advice and suggestions from lower level employees then it will help in reducing difference
between them.
Gender equality: In Australian context, treating women equally to men is standard
practice. Women's also secure top ranking positions in corporate world having authority and
responsibility to take decisions to their own. According to Australian business ethical behaviour,
treatment of women professionals is same as treatment of people without taking consideration
their social status and respecting them.
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Negotiations: Negotiations in ethical behaviour are done by keeping in mind company
policies and rules. Decisions are taken on the basis of facts, figures, proofs, and regulations
rather than flowing in emotions. Australian companies often concentrates on doing negotiation
process fast, adopting new ideas but on verifiable grounds. They do not believe in manipulating
matters, bargaining instead they are centred on direct communication with other party.
Personal relationships: In Australian corporate business ethics, one's personal life is
not mixed with professional life. However they can talk to their peers, colleagues and can
establish informal relationships with them. But in this culture employees do not involve much in
each other's personal space because it can lead to offence or controversy. Matters which can
create difficulties such as religious, political views which differs from one person to another.
Information based on the survey conducted by EY in Asia-Pacific shows that employees
of Australian companies believes frauds, corruption and scandals are increasing due to
deteriorating economic state of country, emerging tough competition between companies in
same industry and decreasing in quality of goods as well as services. Business ethics and
corporate ethics are one and the same things. These are applied in every area or department of
business. And helps through providing guidance to corporates, maintaining their better relations
with investors, shareholders, government. Business ethics can be in the form of values, beliefs,
norms, culture or morals. They can be either derived from individual perceptions, businesses
code of conduct or from any judicial system. This philosophy of business ethics came in 1960's
when awareness rises among corporates to consider consumer as king of market, also in
respect to environmental issues concerns, corporate social responsibility, and on social issues.
Business ethics are in trouble due to slow down in economic growth in Australia (Kolk, 2016).
Australia has formulated Australian ethical standards and are compulsorily need to be followed
by every provider of products and services. Some ethical code of conduct for Australian
businesses are:
 Resources are scarce, so there should be effective and efficient use of these
resources.
 For smooth processing of management systems, responsibility and accountability
should be clear and should be divided among all according to capabilities.
 Company can take competitive advantage but in a fair manner of competition.
 Behave in honest, ethical and fair manner without any prejudice.
 Employee or any business person can not look for any financial or personal
benefits while performing business duties.
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 There should be direct and open communication while negotiations with
suppliers.
 If anyone observes corruption or bribery in company, then immediately report.
 Work health and safety standards should be properly followed.
Study of business ethics consists of examining business practices, principles, corporate
governance and corporate social responsibilities. Sometimes these ethics are also guided by
law. It deals with obligations of a company that production activities of should not affect
environment. Ethical behaviour in business is not only about right and wrong instead it is a
broader concept which deals with standard codes of conduct (Fisher and Bonn, 2011). And
these are managing conflicts between business and personal interest, should not involve in
insider training, employees or managers can not earn unauthorised gains. Everyone is
responsible for due care and conscientiousness in decision making and in performing duties.
Company should be aware about policies and procedures on the basis of which work will be
done. In case of breaching any of the above discipline, action would be taken on that
organisation.
1. Case study
There were many scandals and frauds arise in history of Australia including major banks
and companies. One of them was scandal of Commonwealth Bank of Australia. This bank is
among four largest banks of Australia holds large market share in banking and finance industry
providing a variety of banking services such as insurance, broking, lending, investment etc. It is
also in the list of oldest banks operating in Australia. In year 2018, Royal Commission found
misappropriation of accounts, misconduct, financial fraud, money laundering and many other
illegal activities prevailing in Commonwealth Bank. Also bank denied to give claims to insurance
policy holders, given irrelevant financial advice and provide compensation to individuals at slow
pace. Between 2000 to 2016, all the bank account details of 20 million users were lost by
Commonwealth Bank that was later admitted by it in 2018. In case of money laundering
Commonwealth Bank has agreed to pay $700 million when it failed to provide report on details
of transfer of money, deposits made, and accounts (Commonwealth Bank fined for money
laundering, 2018).
This report is based on Ethical codes of conduct prevalent in Australia. Codes of ethical
behaviour are mandatory for every member of company to follow guidelines. These standards
are given in Australian community worker's code of ethics and Australian community work
practice guidelines. These codes relies on fair treatment of everyone in Commonwealth Bank of
Australia, clarity in communication, integrity of system software, co-operation with other
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associates and also supporting them, healthy work environment. These are all related to
conditions inside Commonwealth Bank, also there is a responsibility towards general public
because they use their resources. So in return Commonwealth Bank should give non-monetary
benefits to society in the form of education, employment and other amenities. This phenomena
is known as corporate social responsibility which is now compulsory for every organization. As
compared from earlier time, CSR was not having so much importance but in recent years it is
expanded. In some countries, it is mandatory to give some percentage of profit as CSR
contribution to society (Pullen and Rhodes, 2015). For example, company that follows ethics
cannot ensure about profit and in contrast another company that does not follow code of ethics
can give guarantee for profit. This is because, in this era public wants that every bank should
behave in ethical way. So if any company acts in such manner, it can improve public image of
an organisation. Also banks that acts ethically gain more advantage as compared with banks
does not follow ethics. Business ethics are necessary because today many organisations can
commit fraud or misconduct which creates threat to economic conditions of a country.
Business frauds can not be easily determined initially as seen case of Commonwealth
Bank of Australia. If Commonwealth Bank do some misappropriation in accounts at a very small
level then it can not be recognized in shorter time because of complexity of transactions. It is
recognized after a long period of time when amount of misappropriation increases. Ethical
misconduct is not only happens in the area of financial matters but it can also be determined in
the area of environmental hazards, bribe and corruption scandals, ill treatment of employees,
slavery, child labour etc. Generally large organisations like Commonwealth Bank of Australia
commits fraud after establishment of trust and brand image in the eyes of customers.
Responsibility of managers and a corporation is to maximize profit of shareholders in ethical
way. AUSTRAC (Australian Transaction Reports and Analysis Centre) is financial intelligence
agency of Australia who imposes allegations on Commonwealth Bank of Australia for money
laundering. In that case Commonwealth Bank was also bound to pay legal cost worth $2.5
million to AUSTRAC. Business ethics can also be understood with the moral and cultural
standards taught by parents to their children. So in the same way banks should also follow
these standards. These standards forbids immoral actions. An enterprise is a group of person
combines to form an organisation, run it and also generating profit. Some people say that ethics
are mend for individual or a human being, business is only runs according to law and to earn
profit. But as one knows that business ethics are different from just ethics or business ethics are
much broader than just ethics. Success or failure of Commonwealth Bank is also attached to the
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internal as well as external stakeholders in which it is operating (Deshpande, Joseph and Shu,
2011).
Ethical and moral standard of an enterprise develops culture and also create impact on
employee's morale, image in the eyes of public, their trust, and also on potential consumers.
Business ethics can not be understated because it builds trust to other peers also so that it
helps in future collaboration along with customer loyalty towards them increases.
Commonwealth Bank which adheres to business ethics gain extra benefit as compared to other
competitors who can face judgement of law, criticism by general public etc. Unethical issues of
an enterprise included violation of patents and copyrights, bribery, hazardous working
conditions, unfulfilled commitments, not complying with environmental standards, use of harmful
raw materials, improper arrangements of safety for workers, harassment at workplace etc. Law
and business ethics are also related with one another in the fact that if company is violating law
then it is understood that it is also violating the law. These are increasing because fines charged
by government is very less as compared to their share of revenue. This resulted in continuous
committing unethical practices because it does not create any burden on that entities.
Business ethics are divided in various parts according to department:
 Business ethics in human resource: Here in this department of Commonwealth
Bank of Australia, ethics are applied in managing human resources with equality,
hence they should be discriminated on any basis. Because if they will treated fairly
then it would boost their morale. Also employees will become more productive and
able to perform given task efficiently and effectively. If company well treat their
employees then in the future it helps to attract talented work force and create
efficient pool for recruitment.
 Business ethics of sales department: This can be understood with the help of an
example, tobacco and liquor companies produces products which are very harmful
for human health. As well as it can also cause dangerous diseases. This side of
these industries can not be compensated to the employment created by them.
 Business ethics in marketing area: Marketing is vital part for Commonwealth
Bank. And it is done after analysing needs of customers. But today companies try to
manipulate moral values and customs. Marketing strategies are used in
organisations to establish brand image, to take competitive advantage, to make
goodwill, to draw potential customers etc. So to take advantage of these they often
provide misleading information.
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 Business ethics of production department: In process of production, companies
sometimes forget about environmental concerns, means create pollution, release
toxic substances from factories which later create water pollution, also air pollution
caused by releasing harmful gases. Most of the experiments are done on animals
which should be forbidden. Many NGOs, social activists and government are working
in this area to save environment and also insisting on producing environment friendly
products.
 Ethics in competition and insider trading: Competition can prove better if happen
in a ethical way. Some common unethical practices in business are price
discrimination, price wars, fixing of price etc. Insider trading is illegal if any person
trade in securities with the information not available to general public. But legal in
case crucial information is public.
Business ethics are also applied on companies doing business internationally. Big
international companies and multinational corporations which involved in overseas trade to earn
profit as well as for expansion are neglecting business ethics (Fernando, 2011). These
companies look for countries in which labour is cheap and resources are in abundance. This
behaviour increases competition between developing countries to provide cheapest labour and
resources to companies of developing countries. Along with this they also want flexible law
system so that MNC do not have to spend much on dealing with the legal system. So this all
contributes in unethical behaviour in which these companies involved in exploiting developing
countries. Concept of business ethics will be more effective if it will be associated with effective
corporate governance. Corporate governance refers to the system in which roles and
responsibilities of every participant in management of organisation are evenly divided such as
board of directors, managers, stakeholders, employees, shareholders etc. so that decision
making becomes smoother. At last business ethics in every organisation is necessary for
facilitating business operations. It is considered as an significant factor while taking any decision
regarding corporate affairs.
Outcome: Result of this case study is that in Commonwealth Bank of Australia many
scandals arrived relating to financial planning, advice, information data loss, insurance
department fraud, financing risky projects of fossil fuels which can lead to disastrous situation in
climate change. So later in this case study, corporate social responsibility along with corporate
governance have been discussed. And how these unethical behaviour by banks like
Commonwealth Bank can be minimized with the help of applying ethical codes and conduct in
every department of banks or organisation (Higgins, Milne and Van Gramberg, 2015). After
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that businesses that involves in overseas trade violate business ethical standards. As
Commonwealth Bank had also done the same.
2. Case study
The scandals of the 1980s, broaden in to the 1990s, came as a fundamental shock to
Australians and new Zealand. Both countries have pridefulness themselves some what naively
and smugly and on being open, antitrust and honest societies (Business Ethics in Australia and
New Zealand, 2000-2018). So it was very convincing to see both gross dereliction and
corruption of exposed to duty in virtually every sphere of public life. But the most optimistic
outcome, however, a midst an almost Australia have daily diet of amazing revelations, has been
ability to operate system specially the media and judiciary – to reveal and dealing with
dishonesty at the high level.
After literature review and an extensive survey it is clear that there is now distributed
awareness of the need for reform in many areas of corporate governance, public administration
and professional behavior (Ramsay, Troth and Branch, 2011). A continuing cause for
involvement lack of leadership in addressing and identifying complex ethical dilemmas, this
area particularly related to disclosure and conflict of interest. In ethics education giving different
different indication relating to feedback from professional bodies, university business school and
industry association and indication is go slow. While several ethical prominent individual and
centers ethicists have acquaint given ethical issues and innovative programs greater than
prominence in the narrow vocational ism and in the media still takes precedence over personal
values in the business and management curriculum (Mujtaba, Tajaddini and Chen, 2011).
There is advanced degree of need confusion in New Zealand and Australia. This is the
ascendant drawn from opinion survey, relevant publications and a variety of initiatives that have
wanted to address ethical problems. The recent surveys conducted to confirmed impression by
the author including a broad cross section of the community and covering about forty
universities, government, professional bodies, agencies and businesses. Many times leaders let
down to people. Nadir is one of them and in 1980s represent his dictatorship and never want to
repeat that. The collective sense, of shock, shame, and disappoint comes through quite strongly
(Galbreath, 2014). Business ethics have influence positive impact on development and
intellectual capital. Knowledge has most important part of modern businesses and this study
argues that business ethics related with the development of intellectual capital and intangible
knowledge resources. Businesses are with ethical values at the set of reinforce ethical conducts
and they try to successfully to build trust with their various stakeholders. They are leading to the
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formation of an ethical approach for business. With this approach business can encourage
problem solving, creativity among employees, open communication and increase organizational
capital. For increasing to human capital attract and retain to good talent (Edwards and Kirkham,
2014).
Ended the years, growing attention has been paid to the environmental, ethical and
social dimensions of business, mostly related to corporate social responsibility heading. They
are praise to various types theories of ethics. They are as follows -
 Realist theories – According to this theory suggested that an action is morally
right when that action make more total utility for the group as a phenomenon than
any other options. Sometimes using this slogan “The greatest good for the
greatest number”. This is computing quantitatively the projected of general
population's utility among competing options. In this principle appeals that
underlie democracy and capitalism, it is a realist theory. The normative
connection with the good and aggregate happiness is a factual claim. In this
including deontology theory that one's duty to do for particular action and this
action inherently right and calculations of other sorts. It defines right action of it's
ability to take the greatest aggregate utility.
 Swing theories – Ethical intuition-ism can described justification of theory and
describe proximate grasping of self evident ethical truths. Virtual ethics is also
sometimes called character ethics and agent based (Vitell, 2015). It takes view of
point of living of life should try to excellence that all do and others do. For
example: an athlete can achieve excellence in a sport ans as well as same a
person achieve more excellence. These Virtues or excellence are both like non-
moral and moral. The way for these habits are developed and excellence will sort
of community of virtue ethics under the umbrella. When god and value of truth
are sources of these community values, then the theory based on realist. When
culture based geography sources using for random creation, then the theory is
anti-realist. In this theory behavior influence by the culture and that is real effect.
According to this theory all are social animals and this theory often draw with
communitarianism, which corroborate positive mutual role that society plays in
our lives. Detractors are point on that fact that virtue ethics does not spring
particular directives on specific actions (Cheshire, Everingham and Pattenden,
2011).
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 Anti realist theories – Ethical non intuitive is a theory that advise the descriptive
analysis of culture and language tells us in ethical situations on appropriate
attitude in need to developing. Ethical propositions can be analyzed by linguistic
devices, and follow the social program as represented to society and language.
These values of social group and society related to imperatives.
The environment of business ethics relating to battle of reputation, credibility and
competitive advantage. During the past 30 years, the business exist for society and
shareholders have been increasing his expectation. Many people are have stake so they are
take interest of business impacts and activities. In business ethics influence by technology and
innovation and technology is developing in a very fast and achieve technology evolution and
new inventions (Galbreath, 2011).
Outcomes – According to this case study result will be come that corruption is main
problem of this study. Both countries not following accounting standard principle so they don't
showing financial statements of companies and stakeholders disappointed with them. That is
reason to increasing unethical behavior in business (Golob and Podnar, 2011). The countries
are exposed in virtually every arena of public life. After that positive results comes that as
amazing revelations that was ability of the system and specially media or judiciary helping them
to expose corruption on highest level. After survey on this case literature review clear that
awareness needed on broadly level in these areas corporate governance, public administration,
and professional behavior. In these countries companies did not showing records and annual
reports to government and stakeholders and they were earn for personal use, not distribute
dividends and profits on time. If they were showing financial statement so they were not properly
categorized every head in under headings. After that taking feedback from many sections like
as university businesses, professional bodies, industry association and business schools were
giving reason that low progress in ethics education (Lindorff, Jonson and McGuire, 2012).
Comparison between above two case studies on business ethics:
Case study I Case study II
In this case study, ethics and codes of conduct
applied in Australian companies have been
examined. Also rules and regulations of
governing body of ethical business standards
are mentioned. Focus is on only businesses
operating in Australia. Interpretation of
While this case study explains about scandals
and frauds arise in Australia and New Zealand
regarding violation of established ethical
business standards. So concentration is on
above mentioned two countries. Earlier both
these countries were very confident on their
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business ethics in internal and external
environment. Consequences of unethical
behaviour by businesses are also discussed.
honesty, loyalty and trust but after frauds, they
both started to strengthen their policies of
business ethics. Also compulsion to follow
standard ethics in subsequent areas.
Later, various forms of business ethics are
given such as ethics in area of human
resource, sales, marketing, production
department, competition and insider trading.
Various types of ethics theories are being
explained such as realist theories, swing
theories, anti realist theories etc. These
theories draw attention to corporate social
responsibilities of companies.
After that concept of international business
ethics is mentioned which states ethical and
unethical behaviour of multinational
corporations exists in developed countries with
other developing countries. This happens at
the time of establishing business overseas.
In this case study, impact of technological
advancement on the culture of a country
during recent years has been analysed. Along
with this influence of innovation on business
ethics.
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CONCLUSION
This report concluded that business ethics necessary for every business for carry on
businesses on broad level in accurate way. So in first case study commonwealth bank including
many scandals that is not related with business ethics like as money laundering, loss customer
data, financial data loss, not giving insurance claim and not taking advise by financial ad-visor
for financial planning after that result was come that government charges fine on the bank for
these scandals. In second case study Australia and new Zealand's companies not showing his
financial data to stakeholders and not follow accounting standard principles for maintain
accounting. After that government showing news broadly sphere to everywhere through media
and virtually. After that government organize innovative programs and giving information about
ethical issues.
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REFERENCES
Books and Journal
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The handbook of communication and corporate social responsibility, pp.231-251.
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Ramsay, S., Troth, A. and Branch, S., 2011. Work‐place bullying: A group processes
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Online
Commonwealth Bank fined for money laundering, 2018. [online]. Available through:
<http://www.abc.net.au/news/2018-06-04/commonwealth-bank-pay-$700-million-fine-
money-laundering-breach/9831064>.
Business Ethics in Australia and New Zealand, 2000-2018. [online]. Available through:
<https://www.jstor.org/stable/25073016?seq=1#page_scan_tab_contents>
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