Corporate Governance and Ethics: 7-Eleven Editorial Analysis Report

This report presents an analysis of two editorials concerning the 7-Eleven wage theft scandal, comparing perspectives from The Sydney Morning Herald and The Financial Review. The Sydney Morning Herald's editorial focuses on the exploitation of employees, particularly international students, and criticizes the corporate office and government inaction. It highlights the detrimental impact of the business model on both employees and franchise owners. Conversely, The Financial Review's editorial emphasizes the potential damage to the business and industry caused by the allegations, taking a more critical stance towards the investigation and its evidence. The report underscores how the different target audiences and editorial biases of each publication influence their viewpoints, emphasizing the importance of considering multiple perspectives when evaluating news coverage and understanding the multifaceted nature of corporate governance, ethics, and media representation. The analysis also includes the importance of unbiased reporting in media.

Editorials 1
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Editorials 2
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Sydney Morning Herald
A Joint Investigation into 7-Elevens in Australia by Fairfax Media and Four Corners revealed
the systematic underpayment of the employees and doctoring of Payroll records. After the
investigation was revealed, there have been class-action suits against the owner of 7-Eleven
for wage fraud.
The government and politicians have created an issue regarding the same, but there has been
no action taken by the government. The question also remains of how an organization such as
7-Eleven, which operates on the franchise model, with a 57/43 per cent profit split, can
exploit their workers on the scale that has been unearthed. The business model that was
adopted has been creating immense losses for the franchise owners., who receive only 43% of
the profit and are expected to pay employee wages from the 43%. Many owners operated at a
loss.
It could be said that the fault was in the hands of the corporate office, and any investigation
that they have instigated was revealed to be smoke screens in order to protect the corporate
office. In the end, it is the poor who have to suffer for the demands of the rich. The poor
employees and franchisee owners take a majority of the hit in order to make profits for the
head office.
The main fault of this could be rested on the corporate office, who have demanded a great
amount of profit from the franchisee owners. The franchise owners would not be able to
afford the amount that they have on employee fees. This is the main reason that employees
are not being paid fairly. However, it is due to the fault of the government and the regulations
that have been put forward by the government that corporations are able to overcharge the
franchisee owners to such an extent that they are forced to take the salaries.

Editorials 3
Summary
The Sydney Morning Herald offers a centrist view on most issues that are going on. The
owner of the Sydney Morning Herald is Fairfax Media, which is also the investigating media
house. This would mean that the Sydney Morning Herald would have an editorial that is in
line with the investigating team, and which supports the investigation to the maximum degree
that is possible (Gao, 2018). The editorial thus looks at the facts of the investigation, and the
various consequences of the actions that have been taken. Since the Sydney Morning Herald
offers a centrist view, the editorial is mainly neutral and offers the public the chance to make
their opinions based on the facts (McKenzie, 2018). This editorial is the one that will
however, question the organizational office and the government for lack of action and
provide as much facts into the case as possible. The business model that has led to the
systematic theft, and the rules and regulations would not be discussed in the editorial, since it
is a paper that is meant for the masses, and the main aim of the editorial would be to inform
the public on the investigation that is being conducted (Osborne, 2017). The main issue
would also be the fact that international students are the ones that have been targeted the
most. Most centrist newspapers and those that lean to the left in terms of their political
opinions have the same kind of news (Mee, 2017). The same kind of opinion, that it is the
people and the employees who have been employed by the organizations in the franchisees
and in many ways, the franchisee owners are the ones that are suffering the most due to the
alleged malpractice in the organization.
The Financial Review
Fairfax Media and Four Corners have a joint media investigation that revealed the systematic
underpayment of employees at 7-Eleven, which is one of the largest franchisee chains in

Editorials 4
Australia. The franchisee chains, which are owned by Russ Withers, have been under
increased public scrutiny after the media investigations were carried out.
There have been allegations of underpayment, and malpractices and exploitation of
international students against the franchisees of 7-Eleven. This can dramatically impact the
lives of the franchise owners, many of whom have been operating the franchisee at an alleged
loss for a number of years, and have invested a significant amount of time and resources into
the franchisee. 7-Eleven has been found to have a great track record, and the office has nearly
620 franchisees, and make an estimated profit of $1.44 million. The investigation could
dramatically impact the organization and the way that it conducts business.
The government and politicians have decided to launch an investigation, but there have been
an immense number of issues that have led to the delay in the investigations. In such a
scenario, it is essential that the investigation be carried out so that the organization’s
reputation does not continue to suffer through a media trial.
Most of the documents that have been reviewed have not been reviewed by law enforcement
or anyone from the government. There needs to be government action that is done, in order to
find the real culprit behind the wage disparities and theft that is alleged by the media. 7-
Eleven is one of the major employers in the area and the potential loss of jobs is of immense
importance to the Australian public. The offices of 7-Eleven have made a public statement. It
is not up to the government to decide if corporate should suffer for the mistakes of the
franchise owners.
Summary
The financial review, however, is a financial paper that has news that are related to business.
Since the main reporting would be related to business, it does not offer an opinion on the
employees that have been suffering or the issue of the franchisee owners not being able to run

Editorials 5
the franchisees on a profit (Sivaraman & Turner, 2016). For this paper, the main issue would
be the effect that it would have on the business and the industry as a result of the
investigation. Since they are not directly involved in the investigation, there are many reasons
for them to be more critical of the investigation and the evidence that is recovered from the
investigation (Berg & Farbenblum, 2017). They will put more emphasis on the business and
how it can potentially be harmed by the allegations that are being made.
The focus of both the papers has been drastically different, primarily because of the target
audience that reads the papers and who make up the majority of the stakeholders, as well as
the political leaning of the paper and the opinions of the editorial board as well (Forrest &
Hirayama, 2015). There is always a biased opinion of the news that is provided, and the
editorial section carries the opinions of not just the editor, but also the owners of the
newspaper as well (Thornthwaite, 2017). Thus, it can be seen that it can directly impact the
issue. Most newspapers have different opinions on the same piece of news because of the vast
differences in the target audience and the owners of the media house. Thus, it is important to
keep in mind that while most newspapers try to report just the facts, it is almost always
biased.

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References
Berg, L., & Farbenblum, B. (2017). Remedies for migrant worker exploitation in Australia: Lessons
from the 7-eleven wage repayment program. Melb. UL Rev., 41, 1035.
Forrest, R., & Hirayama, Y. (2015). The financialisation of the social project: Embedded liberalism,
neoliberalism and home ownership. Urban Studies, 52(2), 233-244.
McKenzie, M. (2018). The erosion of minimum wage policy in Australia and labour's shrinking share of
total income. Journal of Australian Political Economy, The, (81), 52.
Mee, K. J. (2017). Necessary welfare measure or policy failure: media reports of public housing in
Sydney in the 1990s. In Social constructionism in housing research (pp. 117-141). Routledge.
Gao, L. (2018). Wage theft. Arena Magazine (Fitzroy, Vic), (154), 17.
Osborne, S. (2017). Morey calls for action on wage theft. Newsmonth, 37(2), 9.
Sivaraman, G., & Turner, P. (2016). The 7-Eleven wages scandal: The need for law
reform. Precedent (Sydney, NSW), (135), 53.
Thornthwaite, L. (2017). Australia's wage theft crisis. Advocate: Journal of the National Tertiary
Education Union, 24(1), 28.