Marketing Management: Optus' Negligence and its Impact on Stakeholders

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MRKT20052: Marketing Management and Digital Communications
Term 1, 2019
Assessment 1a: Analysis of article 1
<< Optus accused of negligence over failure to disclose donations to Liberals and Labor>>
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In this article, the issue which the company Optus is facing is going to be discussed. It has been
reported that the Optus is facing the accusation of negligence after it failed to disclose donations
to the labor and Liberals. Four criminal offenses have been admitted by the Optus while seeking
for work approval in the Snowy Mountains after the failure of the disclose donations to the labor
and liberals. When Optus criminally failed to disclose $5400 in political donation it was
negligent during the development application, and also its reform efforts have been in deficiency
as per the documents.
Between September 2014 and April 2015, the donation made by the Optus includes $1500 with
Baird for a boardroom lunch, $150 for the meeting with the New South Wales premier while
breakfast, $500 with the Liberal MP Andrew Constance for a lunch event, $750 with the Liberal
MP Pru Goward for an event, $1500 with the Labor opposition leader for a lunch event and
$1000 for a lunch event organized for Liberal state election (Knaus, 2019).
According to the court documents, the Optus staff may have not realized that the events of
payment for ticketed liberal and labor constitute some political donation. To NSW electoral
authorities the donation was disclosed later. The vice-president, Greg Sheridan, of Optus
conceded that the system of the company was not that strong to ensure donations, as required,
were declared. At the relevant time, Optus did not have in place system to ensure the
requirements of the EPA to be met which were adequate and Optus accepts it.
It was said by the prosecutor that the statement of the Optus was an admission of negligence. The
vice-president of Optus accepted that there was a failure to have a system of adequate in place
for meeting the requirement of disclosure but the accusation to amount to criminal negligence for
the disclosure of the obligations, has not been accepted by the Optus. Since being alerted in
2107 to the omission the company had taken significant to ensure the donations for the proper
reporting. For identifying how the donation had been omitted, it has commissioned an internal
review comprehensively. During the development application, the contractors had been reminded
to their disclosure obligations, law firm Clayton Utz was retained to advise the obligations and
provide staff training of it and also the implementation of new policies on planning approvals
and political donations (Orr, 2016).

Stakeholders of a company are the key persons who have an impact on the performance of the
company. Stakeholders of the Optus are government and regulators, employees, shareholders
which help the company financially, customers, charity partners, community organizations and
suppliers. As the company is facing the issue of disclosure donations to the labor and liberals, it
may result in a decrease of the shareholders of the company. As the shareholders are the key
persons for the company because they provide financial health which is very important in the
growth of the company, the loss of shareholders will eventually decrease the financial help and
may also decrease the revenue of the company (Laszczuk, et. al., 2017).
The reputation of the company is in the stake which will affect the overall profitability of the
company because the company’s reputation will deflect the customers and it will become very
hard for the company to keep the existing customers and also to attract new customers. The
employees of the company will also get affected by this issue because they are a part of the
company. The decrease in profitability of the company will decrease the incoming supply of the
raw material which will affect the suppliers of the company somehow.

References
 Knaus, C., 2019. Optus accused of negligence over failure to disclose donations to
Liberals and Labor. Available at:
https://www.theguardian.com/australia-news/2019/mar/21/optus-accused-of-negligence-
over-failure-to-disclose-donations-to-liberals-and-labor [Accessed on 2 March 2019]
 Laszczuk, A., Garreau, L. and De Montmorillon, B., 2017, June. Understanding
emergence in business model development: how companies interact with stakeholders to
deal with environmental ambiguity. In XXVIème conférence de l'Association
Internationale de Management Stratégique.
 Orr, G., 2016. Party finance law in Australia: Innovation and enervation. Election Law
Journal, 15(1), pp.58-70.

Appendix
Link of article
Screenshot of article