Analysis of Corporate Culture and Business Law in Australia Report

This report provides an overview of business law and corporate culture, emphasizing the importance of ethical conduct and legal compliance for corporations. It defines corporate culture as the collective values and behaviors within an organization, highlighting its connection to corporate governance. The report outlines key legal provisions in Australia, including the Corporations Act 2001, the Australian Securities and Investment Commission Act 2001, and ASX principles. It discusses the impact of these regulations on managing corporations ethically, and includes examples of corporate fraud cases, such as Sino Australia Oil and Gas Limited and Storm Financial Limited, and Dreamland Amusement Park, illustrating failures in corporate culture and risk management. The report concludes by stressing the importance of a strong corporate culture and compliance with corporate governance principles for enhancing a company's value and stakeholder trust.

Running head: BUSINESS LAW
Business law
Name of the Student
Name of the University
Author Note

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According to Guiso, Sapienza and Zingales (2015) corporate culture consists of values and
behaviour which make a contribution towards the unique psychological and social environment
of a corporation. It is the representation of collective beliefs, principles and values of
organizational members and has been created through elements such as strategy, history, product
market, employee types, national culture and the types of management. It further includes the
vision, norms, languages, location, habits, belief, symbols and values of a corporation. Further
organization culture refer to an emergence of a significantly complicated state which cannot be
calculated which results out of combining a few elements. There are three manageable
ingredients in relation to the culture of a corporation. These include employees, work and
customers. A good corporate culture asks the mangers of an organization to conduct their
operations in an ethical and legal matter and in the best interest of those for whom they work.
Corporate culture is strongly related to corporate governance which asks an organization to
operate ethically by taking into consideration the interest of its stakeholders.
In order to ensure that a healthy corporate culture is maintained there are several laws and
provides in place which govern the actions of those who have the responsibility of managing
corporation. In Australia these provisions includes the Corporation Act 2001, Australia
Securities and Investment Commission Act 2001 and the rules and corporate governance
principles provided by the Australian Securities Exchange (ASX). Under the Corporations Act
the managers are provided by several guidelines which they must comply with while managing
an organization in Australia. Under these guidelines the corporations must not defraud their
creditors, provide the correct information and no engage in a conduct which is misleading or
deceptive. The managers also have be reasonably carful while performing their functions, they
have to function in the best interest of the corporation, they must also not mis utilize information

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and position for making personal interest and defrauding creditors. The ASX principles asks the
organizations to functions ethically and have risk management practises in place. However in
spite of such principles there have been various corporate frauds and principles in Australia. One
of such scandals have been seen with the company Sino Australia Oil and Gas Limited. This
company was a subsidiary company of a Chinese organization. The company provided several
fake and false information the public to get public money when it offered its first public offering.
However the fraud did not stop here alone. The director of the company Mr Shao wanted to get
the 7.5 million dollars of public money transferred to Australia. The ASIC made its intervention
into the situation and public money worth 7.5 Million was saved. The issue was take the court
where the director who was behind the fraud had been asked to pay a hefty fine to the
commonwealth and he was also banned for being a manger of an Australian company for a
period of twenty years (The Australian 2018). Another example where corporate fraud had been
seen in Australia was in relation to Storm Financial Limited. In this case there have been wring
advice provided by the company to poor investors who were in their old age and had to mortgage
their houses to get investment as asked by the company (The Conversation 2018). There was
another problem in relation to dreamland amusement park where due to the defect in a ride four
patrons lost their lives. These was an evident lack of risk management system within the
company as it failed to inform the family members of the deceased for 24 hour which lead to a
big controversy as well as hardship for the family members (Murray and Wahlquist 2018).
Form the above discussion it can be derived that a good corporate culture has to be present in
relation to a corporation for its effective functioning. Corporate culture can be implemented by
ensuring compliance with corporate governance principles and legal provisions. The culture can
also be enhanced by following the principles of the broad view of corporate social responsibility

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and working ethical to ensure the best interest of the company and also the needs of its
stakeholders. When the organization does so its value in the society automatically gets enhanced
and it leads to overall increase in value for the corporation.

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References
Guiso, L., Sapienza, P. and Zingales, L., 2015. The value of corporate culture. Journal of
Financial Economics, 117(1), pp.60-76.
Murray, W. and Wahlquist, C. (2018). Dreamworld accident: four dead at Gold Coast theme
park. [online] the Guardian. Available at:
https://www.theguardian.com/travel/2016/oct/25/dreamworld-accident-gold-coast-theme-park
[Accessed 13 May 2018].
The Australian (2018). [online] Available at: https://www.theaustralian.com.au/...sino-australia-
oil-and-gas...fraud/.../ab757958e67dd... [Accessed 13 May 2018].
The Conversation. (2018). Financial advice reform: have we learned enough from Storm?.
[online] Available at: http://theconversation.com/financial-advice-reform-have-we-learned-
enough-from-storm-5299 [Accessed 13 May 2018].