Environmental Innovation and Societal Transitions

THE EFFECTS OF ETHICS
AND CULTURE IN A
LEARNING ORGANIZATION
ANZ bank is also called the Australia and New Zealand Banking Group Limited, which is a multinational company involved
in banking and financial services with its headquarters located in Melbourne, Australia. The bank was established by the
merging of Union Bank of Australia Limited and Bank of Australasia on 1st October 1951. The bank is one of the four pillars
of Australian economy driving the banking and financial operations mostly focussing on commercial and retail banking.
However the bank is also the talk of the media due to the controversies surrounding the bank’s reputation.

INTRODUCTION:
 The organizational learning theory is a process by which the focuses to change their
goals and actions in accordance to changing environment (Kirwan 2016). This
induces competition and goal changing strategies (Da Costa, Bui and Zwart 2017).
The four traits of organizational learning are that the organization should be
involved in constant process of readiness, continuous planning with respect to the
implementation of change and learning objectives, improvised method of
implementation of these strategies, and lastly the action of learning itself which
means that the act of grasping of knowledge and the acceptance of change by the
employees in an organization (Chung, Ding and Ma 2019).
 The thesis aims to establish the critical analysis of the factors that caused the
recent ethical scandals of the bank by the application of learning organization
theories. The thesis further deals with the examination of current organizational
culture of the bank and its impact by the application of organizational theories. The
thesis further analyses the barriers to organizational learning and further
recommends strategies to become an ethical learning organization.

ETHICAL SCANDALS AND ITS ANALYSIS
BASED ON ORGANIZATIONAL THEORIES:
 In 2016, the bank, along with its other traders were accused for manipulation of the
benchmark rates which are affirmed as the inter-bank interest rates in Australia. In these
accusations, ASIC claimed that the bank was engaged in unconscionable conduct and
manipulation against ANZ (Jonathan Shapiro 2020). Applying the Assimilation theory (Shao,
Feng and Hu 2017), it can be explained that the bank should have learned through its
performance. In other words, such act of manipulation of interest rates has been
emphasized as the behavioural approach and that the approach of the organization should
be observable, rational and quantifiable which in this scenario, is the opposite.
 The Bank has further been criticised in a high profile case for making racist remarks
against businessman Pankal Oswal and his wife ((Dailytelegraph.com.au, 2020)). Applying
the Adaptive and Generative theory of Learning Organizations (Chiva et al., 2018), it can
be explained that the existing knowledge of the organization is the foundation of its
existence while the future learnings may amend the existing knowledge with new thinking
to achieve further objectives. The bank knew that racist comment would land it in
controversies and this knowledge could have been used to establish business relations
without the involvement of legal accusations.

APPLICATION OF
ORGANIZATIONAL LEARNING
THEORIES: The knowledge of decision making and its process is an important aspect of learning organization because the
managers transfer a set of information from their arena to that of the fellow employees or colleagues in the
organization (Kyndt et al. 2018). The process of comprehensive knowledge structure of the organization is how
the organizations do and are meant to adapt to the changes of the organization and the changing environment
prevailing and being implemented in the organization in terms of internal as well as the external environment.
There are three unique theories of learning organizations:
 Experimental Learning Theory: it is based on the psychology, philosophy and physiology which influences
leadership and development of an organization, contribution to the foundation of the principles of learning
organization (Martinko 2018). It states that the process of learning starts through the combination of
experience involving grasping and transformation of knowledge.
 Adaptive and Generative Learning Theory: this is an evolution of cognitive theory of organizational
learning which identifies the mental issues related to behavioural aspects like assumptions, generalizations,
pictures and images influencing the understanding of the person towards the world and society and related
actions (Ege, Esen and Asik Dizdar 2017). These include the components of personal mastery, shared vision,
team learning and the systems thinking of Senge’s theory.
 Assimilation theory: this is a compilation of behavioural approach to learning organizations which emphasize
the changes based on actions which take place as the person learns through their own experience or
performance (Braid, Davidson and Mathiassen 2017). These include three basic stages which are strongly
linked to the behaviour of any person and focus on the practical application of their behaviour.