Questionable Practice in Commonwealth Bank of Australia

Running head: QUESTIONABLE PRACTICE
QUESTIONABLE PRACTICE
Name of the Student:
Name of the University:
Author Note:

QUESTIONABLE PRACTICE1
Introduction:
The aim of this paper is to discuss the questionable practice of the management of
reputed organisation of Australia namely the Commonwealth Bank or CBA. In this
organisation the incidents leading to two question in the organisational and management
practices along with the judgements of the managers will be discussed through relevant
organisational theories. In order to understand why the management is making questionable
decisions and undergoing questionable practices will be understood through two
organisational theories mainly the stakeholder theory and the Bureaucracy theory. Both of
these theories will be e revealing insights into the organisational practices in Commonwealth
Bank of Australia. There are limitations of these theories which will be criticized in this paper
and it will be concluded through discussion of recommendations or strategies which the
Commonwealth Bank of Australia can take to overcome this type of issues in the future.
Description of a chosen organisation:
The Commonwealth Bank of Australia for CBA is a multinational Bank ok that has
operations across various countries of Asia United States United Kingdom and New Zealand.
This company provides range of financial services that includes retail, institutional banking,
superannuation, fund management, insurance, broking and investment services. The
Commonwealth Bank is one of the largest Australian listed company in Australian securities
exchange that has the brands like Bankwest, ASB bank in New Zealand, Colonial First State
Investment, CommSec or Commonwealth securities and Commonwealth insurance. This
bank is the largest bank in the southern hemisphere (Bandara et al. 2019).
This organisation was established in 1911 by the Australian government and it is one
of the “big four” Australian banks. In 2005 the Commonwealth Bank of Australia has
established strategic cooperation with two of the reputed Chinese banks and established a

QUESTIONABLE PRACTICE2
representative office in India also (Willcocks and Reynolds 2015). This that the organisation
is expanding in a rapid manner which is supported by the perfect decisions and initiatives by
the management practices however these positive consequences are marred by some negative
incidents. In 2018 the royal Commission into misconduct in the banking superannuation and
financial services industry has found a negative culture in this Bank which included
allegations of deception, fraud and money laundering by the employees and managers of
Commonwealth Bank of Australia.
Definition of theories and justification for choice:
The stakeholder theory is one of the most important Organisational Management
principles includes the interest of the multiple constituencies affected by the business entities
such as the employees, customers, suppliers, creditors, local communities and other
associated stakeholders (Miles 2017). This particular theory addresses the morals as well as
values of the management of an organisation. The stakeholder theory relates to the corporate
social responsibilities, social contract and market economy which align the operations of the
organisations with the interests of the stakeholders.
The stakeholder theory includes both the market based view and as well as resource
based view that add a socio-political level in the operation of the organisation (Jones,
Harrison and Felps 2018). The stakeholder theory defines the perspective of the stakeholders
of the company and then analyse the conditions under which the management can treat these
stakeholders in a proper way. In the field of Management the stakeholder theory succeeded in
suggesting that the needs of the stakeholders must be put in the beginning of any action
(Cunliffe and Luhman 2012). This theory is important to discuss the issues related with
unethical practices of the managers in Commonwealth Bank of Australia. This is due to the