Trading.com: Governance, Ethics and Sustainability Analysis

This report analyzes the governance, ethics, and sustainability of Trading.com, an Australian share investment advisor company. The report examines pressure points related to growth, including performance demands, expansion rates, and employee inexperience. It also explores cultural pressures stemming from reward systems, executive communication, and internal competition. Furthermore, the report assesses information management challenges, such as transaction complexity and gaps in diagnostic performance. A risk exposure calculator is used to prioritize risks. The report provides a detailed analysis of the company's current situation and potential areas for improvement, focusing on organizational culture, risk assessment, and decision-making processes. The report highlights key areas where Trading.com needs to address issues related to its growth, culture, and information management to ensure sustainable business practices.

Running Head: GOVERNANCE, ETHICS AND SUSTAINABILITY
GOVERNANCE, ETHICS AND SUSTAINABILITY
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1GOVERNANCE, ETHICS AND SUSTAINABILITY
Table of Contents
Introduction......................................................................................................................................2
A. Pressure points due to growth..................................................................................................2
Pressure for performance.............................................................................................................2
Rate of expansion........................................................................................................................3
Inexperience of key employees...................................................................................................4
B. Pressure points due to culture...................................................................................................4
Rewards for entrepreneurial risk taking......................................................................................4
Executive resistance to bad news................................................................................................5
Level of internal competition.......................................................................................................6
C. Pressure points due to information management.....................................................................7
Transaction complexity and velocity...........................................................................................7
Gaps in diagnostic performance..................................................................................................7
Degree of decentralised decision making....................................................................................8
Conclusion.......................................................................................................................................8
Reference.......................................................................................................................................10
Appendix........................................................................................................................................13

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Introduction
Trading.com is a share investor advisor company in Australia that offers common
people share investment courses and advise services. The company is three years old under the
leadership of CEO Jospe Drake. This medium sized organisation is doing a successful business
with its four branches in Sydney, Melbourne, Brisbane and Adelaide. Recently, the company is
facing some serious issues in various aspects such as organisational growth, cultural pressures
and problems in information management. It requires clear insights into the problems and
prioritises the risks on the basis of its intensity. Rapid transformation in the organisational
process led the company to set a number of changes. In this context, this report is going to
analyse the decisions that Trading.com has made. Moreover, the existing organisational culture
is also under the scrutiny of this report. For a better analysis of the risks the report seeks the help
of a Risk Exposure Calculator in order to perceive the fathom of the risks.
A. Pressure points due to growth
Pressure for performance
The increase in sales one year ago pushed the company to expand its business robustly. In
this regard, the business of the Trading.com is associated with selling share investment courses
to the potential and interested customers. The organisation enjoys employee strength over 100.
However, the demand in the market created a deep pressure on the employees as the organisation
does not have adequate workforce to cope with the high demand. According to Michaelis,
Wagner and Schweizer (2015,p. 1040) the workforce strength is considered to be an important
aspect for the business organisations in order to bring more flow and efficacy into the business

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activities. Solaja and Ogunola (2016, p. 53) opined that lack of workforce can disengage the
organisation to proceed towards high profitability. The same problem is faced by Trading.com
as the organisation has limited workforce to perform according to the market demand. There are
over 100 people who are working under Trading.com as consultants. The size of the
organisation is also a contributing factor for its limited workforce. Trading.com is not a giant
concern to have more than 1000 employees working under one banner. The company is belonged
to the medium sized business. Therefore, it is obvious that the lack of infrastructure restricted the
company to employ high number of people. However, the existing employees feel the intensity
of workload. Based on this scenario, the risk calculator scores 4 for the pressure for performance.
Rate of expansion
In recent times, Trading.com has no such intension to expand its physical existence
further. It means the company is not willing to open its new branch. However, it does not mean
Trading.com has no vision of expansion. One year ago the company is facing robust increase in
sales and it boosted the business activity of Trading.com overwhelmingly. From the research of
Duffield and Whitty (2015, p. 320) it can be derived that the rate of expansion is proportional to
the business dynamics of an organisation. In other words, the increase in business can make a
company envisioned to its business expansion. Therefore, for Trading.com also there is a
glowing opportunity to expand its business further. However, Lozano, Nummert and Ceulemans
(2016, p. 172) advocated that there are some key factors responsible to influence the rate of
expansion for a business entity. For example, the infrastructure in terms of human resource plays
a pivotal part in determining the rate of expansion. In this context, Trading.com does not have
enough human resources for its business expansion. Therefore, it is also imperative to continue

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business with the existent business strength and Trading.com is following the same path. Based
on this review, the risk exposure calculator points this rate of expansion risk to 2.
Inexperience of key employees
The article of Arora (2016, p. 39) advocated that it is essential for the business entities to
check the ability of its human workforce and on the basis of that information designs the
structure of the organisation. In this regard, experience plays a significant role that the employees
can use in order to get promotion. Having no experience in key positions can cause a fatal
damage to the organisational development (Shenoy, Uchil and Alexander 2019, p. 207). For
Trading.com the growing market demand compels the senior management to recruit more
people for keeping pace with the demand. However, the company recruits people who have no
experience in this industry and for employing the freshers also Trading.com lowers its
employment standards. Consultants are the key employees for the company who give high
profitability in the long run. Focusing on the market demand and recruiting fresh candidates
cannot be a long term solution for Trading.com. The existing employees are performed good
because of their quality experience in the field. Therefore, in such a high time recruiting less
experience people will definitely hamper the healthy business activities of the organisation
because Trading.com has no time to train those new employees. It is a serious threat for the
company so that the risk calculator marks it 5.
B. Pressure points due to culture
Rewards for entrepreneurial risk taking
Victor, J. and Hoole (2017, p. 10) mentioned that reward was the ultimate motivational
tool that the business corporate used in order to engage the employees with high performance

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and productivity. In this regard, Trading.com also focused on its reward structure from the
inception of the company. The consultants earned a percentage of each $10,000 course fee as an
incentive. It can be stated that the organisation followed a salary structure on the basis of
commission. However, immense pressure on the performance structure led the CEO Jospe to
restructure the salary process more lucrative and handsome enough to encourage the employees
to perform more effectively. Therefore, he is interested to implement a basic salary structure of
$30,000 per annum for the employees. From the research of Gerhart and Fang (2015, p. 497) it
can be stated that the employee satisfaction is the key for organisational development and
financial benefits are the ultimate tool to enhance it. Moreover, for delivering a better
performance the senior management of Trading.com also offers special bonuses to the highest
performing consultants in terms of expensive gifts and luxury holidays. From that point of view,
it can be asserted that Trading.com practices a good reward structure for making the employees
satisfied enough while taking bulk of performance risks. Henceforth, the risk calculator measures
it 1.
Executive resistance to bad news
Trading.com has poor communication practice between the senior management and the
regional managers. The top down decision making of the organisation is really posed a threat for
establishing an effective organisational culture. as per the research of Blackstock, Salami and
Cummings (2018, p. 982) nit can be derived that the role of the organisational decision making
must be time effective and transparent enough to resolve the organisational issues. In case of
Trading.com the power of the senior management was so extensive that the regional managers
have nothing to do. Moreover, the relationship with the employees is also very naive and
ineffective. The employees do not feel free to express their concern to the higher authority.

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Perhaps the top down decision making is the only reason that creates the employees isolated
from the organisational decision making process. Ifinedo and Olsen (2015, p. 2567) pointed out
that the top down decision making in current business scenario was irrelevant because the senior
management had least knowledge about the ground story. The consultants or the employees can
only portray a clear picture of the business process because they have to deal with the customers.
However, for Trading.com the poor communication over the entire workplace can jeopardize
the business intensively. Therefore, the risk calculator marks this risk 5.
Level of internal competition
Level of international competition is one of the major features of Trading.com that the
senior management has created for increasing the sales growth robustly. In course of discussing
the effectiveness of internal competition Wisskirchen et al. (2017, p. 2012) articulated that the
competition within the workplace culture was highly effective for the business organisation
because it provided high productivity in business. This paradigm of workplace competition can
also be seen in Trading.com where the management tries to develop competition among the
consultants by offering them special bonuses in terms of expensive gifts and luxury holiday trip.
The practice is associated with the organisational model of aggressive sales growth strategy. As
per the research of Jones, Davis and Thomas (2017, p. 400) it can be pointed out that the
aggressive sales growth strategy made the managers more concerned about the increase in sales
and brought high expectation from the employees. It is clearly associated with the organisational
strategy of Trading.com where the employees are pressurised to increase the sales growth day
by day. The management is also willing to encourage the employees by offering lucrative special
bonuses. The best performers only get the special bonus. However, it will create a interpersonal

7GOVERNANCE, ETHICS AND SUSTAINABILITY
conflict that can affected the productive culture of Trading.com. Henceforth, this risk is marked
as threat level 4 by risk calculator.
C. Pressure points due to information management
Transaction complexity and velocity
Transaction process in Trading.com is a bit complex and time consuming that makes the
customers frustrated often. It is pertinent for the organisation to look into its transaction
procedure in order to bring more transparency and flow into the transaction procedure. Fanning
and Centers (2016, p. 55) pointed out that transparency and simplicity in transaction is one of the
basic measure that the business corporate must use to satisfy the customers. There are two
possible reasons that create obstacle to implement better transaction system in Trading.com.
First of all it can be argued that the financial limitation is considered to be one of the major
aspects that facilitate problems to install new system for Trading.com. Apart from that
negligence from the companies’ end is also a possible reason that withhold the implementation
of better service facilities for Trading.com. Sundarasen, Goel and Zulaini (2017, p. 757)
mentioned that customers were of primary concern for the business corporate and the companies
should take enough measures to attract and retain its valued customers. However, in case of
Trading.com lack of organisational decision making and dearth of focus on the customer service
pave the way for the organisation to install better transaction procedure. Therefore, the risk
exposure calculator marks it 3.
Gaps in diagnostic performance
Trading.com is highly motivated to put enough emphasis on its business exposure based
on the business strategy of aggressive sales growth. Putting high focus on the sales growth

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obscures other parts of the operation management. It means the company is failed to elucidate its
diagnostic performance related to the customer service. From the article of Georgalis et al.
(2015, p. 101) it can be derived that the role of the organisation is always changing due to the
rapid fluctuation in the market. Therefore, putting a great deal of emphasis on the customer
service can facilitate a strategic advantage for the companies in sustainable business orientation.
However, in case of Trading.com the senior management overlooks this part and dissatisfaction
among the customer is evident. Therefore, the risk calculator marks it 3.
Degree of decentralised decision making
Rached, Bahroun and Campagne (2016, p. 7282) mentioned that the current business
entities are more prone towards decentralise decision making due to two reason. First of all it
will help to ease the burden of important decision making over the senior management and
secondly, the engagement of the employees in decision making paves the way for good
organisational practice and effective communication set up. However, for Trading.com lack of
both the efforts create huge problem for taking serious decisions in dire situation. In fact, the
impact is far stretched where the incompetent decision making of the senior management
encourage the employees to focus on the sales growth rather than maintain good customer
support also. Therefore, this risk also marks 3 in the risk calculator.
Conclusion
The above discussion rightly points out the risks that Trading.com is suffering greatly in
course of organisational growth, workplace culture and customer satisfaction measures.
Incompetent decision making and lack of communication among the employees and the
management create huge issue for Trading.com to attain future sustainability in business. With

9GOVERNANCE, ETHICS AND SUSTAINABILITY
the help of the risk exposure calculator the report reveals the intensity of the risks based on the
marks given in calculator. In a conclusion, Trading.com has to resolve the issues on a priority
basis for setting up better organisational practice in the context of sustainable business
orientation.

10GOVERNANCE, ETHICS AND SUSTAINABILITY
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Appendix
Figure 1: Risk exposure calculator
(Created by the author)