Commonwealth Bank of Australia: Public Relations Theory and Practice

This report analyzes the public relations challenges faced by the Commonwealth Bank of Australia (CBA), particularly in light of repeated scandals related to money laundering and terrorism funding. It examines these issues through the lens of public relations theories, such as Systems Theory and Situational Theory, and provides a stakeholder analysis, assessing the impact on customers, employees, shareholders, industry associations, and the government. The report further explores the damage to CBA's image and branding, identifies existing barriers to ethical conduct and effective PR, and outlines the role of public relations in managing these crises. A sample press release to shareholders is included, along with recommendations for improving ethical behavior and corporate social responsibility. The document is available on Desklib, a platform offering study tools and resources for students.

Running head: PUBLIC RELATIONS THEORY AND PRACTICE
PUBLIC RELATIONS THEORY AND PRACTICE
Name of the Student
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PUBLIC RELATIONS THEORY AND PRACTICE
Executive Summary
The aim of the report is to analyse the public relations prospects of the Commonwealth Bank
of Australia and to analyse the firm in the prospects of the public relations in the context of
the money laundering and the terrorism funding which is one of the major problems in the
sect. The report also suggest the analysis of the public relations prospect of the firm and the
ways in which the ethical conditions of the bank is to be maintained. The impact of the image
along with its role of public relations is to be analysed along with the concerned
recommendations and role of public relations manager.

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Table of Contents
1. Introduction........................................................................................................................3
2. Analysis of the cause of repeated scandals through the lens of PR theories and practises3
3. Stakeholder analysis...........................................................................................................4
4. Impact on image/branding..................................................................................................5
5. Analysis of existing barriers at Commonwealth Bank of Australia...................................6
6. Role of PR in managing these crisis..................................................................................7
7. Press release to the shareholders........................................................................................8
8. Recommendations to become ethical and increase the CSR of organization....................9
9. Conclusion........................................................................................................................10
10. Reference........................................................................................................................11

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1. Introduction
Ethical issues and banks have a longstanding relation as it is very important for a bank
to maintain its ethical value and represent well in the society. The Commonwealth Bank of
Australia, also known as CBA is one of the major multinational banks of Australia that
provides a variety of financial and broking services to the people (Grunig 2013). Being the
largest Australian listed company, the bank is bounded by law and ethical considerations to
maintain its value and be the bank that everyone can trust. The maintenance of the ethical
issues will also positively affect the PR of the bank and maintain its balance in the stock
market. The following report analyses the repeated scandals of CBA in the PR theory and
practise with the stakeholder analysis. The following paragraphs highlight the stakeholder
analysis, impact on image and branding, existing barriers, role of PR and press release to the
shareholders. The recommendations are also being given at the end of the report.
2. Analysis of the cause of repeated scandals through the lens of PR theories and
practises
Public relations is defined as the strategic management of the various forms of
communication between the organizations and the general public which are mutually
beneficial in the cause as well as the maintaince of their image in the public. According to
Dozier, Grunig and Grunig (2013), the work of the public relation of any organization in the
bank is to make sure that the image of the organization is built, enhanced as well as protect
the reputation in the major span of time. The Commonwealth Bank of Australia has a number
of scandals related to money laundering and frauds within the governance of the bank which
can be analysed by using various PR theories and practises. The whole issue of scandals can
be analysed with the PR theories like the Systems Theory and the Situational Theory (Theaker
2017). The Systems theory is the public relation theory that is involved in the understanding
of the relationship between the organization as well as the public whereas the Situational

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theory of public relations is to maintain the communication between the public and to make
sure that their public relation statement are being assessed by the analytical mode of
communication.
According to the scandals of the bank, one of the probable causes for the money laundering is
the defaulted ATM machines as well as the terrorism financing scandal is the lack of proper
guidance in the matters of the financial matters (Hendrix, Hayes and Kumar 2012). The lack of
proper working of the ATM machines made sure that the amount of deposits in the bank
exceeded the amount of the allocated ones. The terrorism funding of the bank in terms also
made sure that the image of the bank was tarnished.
According to the case opinion of Sheridan and Jang (2012), the ATM of the bank accepted
anonymous money deposits and withdrawal in whatever fashion and in research it was found
that some of the money also went to the terrorist funding which also made the whole image
of the bank go withered in the concerned span. Some of the people associated with the bank
were terrorist funders that damaged the bank as well as the people associated.
According to the PR theories which dealt with the image funding as well as the consideration
of the relation between the parties associated with the case (Pearson 2017). According to the
PR theories and practises, the bank is vouched against the terrorism and is expected to act
accordingly and in an ethical way which is needed in all organizations.
3. Stakeholder analysis
Stakeholders of the bank are those people who are associated with the bank in both
bad and good times and are responsible for the working of the bank both in financial and non-
financial terms. The bank has a number of stakeholders who are affected by the scandals
which are as follows –

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Customers – One of the principle stakeholders of a bank are their customers who are mostly
affected by unethical practises as well as scandals of the bank (Grunig 2017). Being the largest
bank of the union, the number of customers in the bank is also large which also affect them in
a major way. The customers are hampered by the unethical practises of the bank in a major
way.
Employees – The employees of the bank are another major stakeholder of the bank who are
affected by the scandals as well as the unethical practises. According to Grunig (2017), the
employees have their incomes and living associated with the bank which are affected in both
ways by the bank.
Shareholders and Investors – The shareholders and investors of the bank are major
stakeholders who are affected by the bank. According to Culbertson and Chen (2013), their
money and financial status is not hold due to the scandals and lack of ethical issues of the
bank which are one of the prime issues of the bank. The investors invest in the bank which
make them liable for the financial loss that is there in the bank due to the financial scams.
Industry Associations – The industrial associations of the bank are another major
stakeholder who are involved in the financial loss of the bank and also the categorising the
bank into the factors of the industry (Coombs and Holladay 2012). The association is liable for
the working of the bank and also is a prime stakeholder in the case of the scandal of CBA.
Government – The government is one of the prime stakeholders of the CBA as it is one of
the prime banks of Australia which has many government accounts and the sponsored
accounts into the realm. The government is liable for the working of the bank in all forms.
4. Impact on image/branding
The impact of the money laundering as well as the terrorism funding of the
Commonwealth Bank of Australia is widespread as it affects the branding as well as the

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image of the bank in one of the prime ways. The bank is one of the largest banks of Australia
which has a number of customers as well as their hopes and trust associated with it (Smith
2013). The bank has a strong public relation business with its stakeholders. The impact on the
image and branding of the Commonwealth Bank of Australia in relation to the money
laundering scam as well as the terrorism funding scam is of prime value and has affected both
the customers as well as the potential investors in some way or the other. The branding of the
bank is dependent on the ways and the ethical issues of the self which is again one of the
prime ways that the bank has been affected.
The money laundering scam which is one of the prime scams and scandals of the bank
in the recent times has impacted the customer satisfaction level and also the working of the
brand by the customers of the bank. In addition according to Botan (2017), the impact of the
scam on the customer footfall is also negative to the fact that not many customers are opening
account in the bank and also are not recommending which affects the business and thereby
the profit of the bank in the longer period of time.
5. Analysis of existing barriers at Commonwealth Bank of Australia
There are a number of barriers that are present in the Commonwealth Bank of
Australia which can be seen as a hindrance to the working of the bank in one of the major
ways in all times. The barriers of the bank are all related to the unethical practises that are
present in the bank and also to the recent money laundering and terrorism funding scam that
has affected the working of the bank in major times (Johansen, Aggerholm and Frandsen 2012).
The analysis of the existing barriers of the bank can be seen in both the in-house governance
of the banks as well as the to the external circumstances which are as follows –
One of the major barriers to the Commonwealth Bank of Australia is the barrier to a
technological development that has caused the malfunctioning of the ATM machine in the

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bank and also to the fact that the technology of the bank should be improved to have the
required amount of the holding of the customers.
Another existing barrier of the bank is the lack of proper public relationship
management of the bank which has affected the reputation as well as the branding of the bank
in all the major stocks of the country (Kunczik 2016). The bank which was amongst the top
banks of Australia and had a decent position in the country fell drastically into the bottom and
made a potential barrier.
The third barrier of the bank is the lack of ethical consideration that is there in the
bank in the potential amount of time. The bank being one of the potential places of trust for
the customers as it handles their financial security proved to be a barrier as the bank faced
issues regarding the ethical behaviour.
The fourth barrier of the bank is the attack of malpractices and people who are not
loyal to the bank and were involved in the money laundering and terrorism funding scam in
the required period of time (Cutlip 2013).
All these barriers of the bank made the bank have low value in the overall financial
market and also to make sure that the customers of the bank have less trust which affects the
bank majorly in a number of ways. The crisis of these banks should be managed by both the
internal technological and governance changes and also the PR betterment to renew their
image in the minds of the customers.
6. Role of PR in managing these crisis
The Public relation process of the bank is one of the major in any case as with the
required amount of public relation management in a bank, it is of utmost importance to have
the required amount of the public relation status in the organization (Doorley and Garcia 2015).
The role of PR in the crisis situation of the bank is of utmost importance as with the required

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amount of public relations, the bank make it a point to retain its customers and also have the
new potential customers who will not be affected by all the past frauds and the mistakes of
the bank. The role of the public relations in the crisis of the Commonwealth Bank of
Australia are as follows –
One of the major roles of the public relations in the crisis management of the bank is
the to justify the deeds that are being performed by the bank in the concerned amount of time.
The fraud that is being adhered to the bank for the Commonwealth Bank of Australia
desperately needs a public relations management that will help the bank to maintain its brand
image in the minds of the public (Culbertson and Chen 2013).
Another need of the public relations is to maintain the goodwill of the bank in the
public eye and also to have the required amount of the trust from the public in the concerned
amount of time. The major public relation management of the bank is determined by the
fraud management of the bank. Commonwealth Bank of Australia has been accused to fund
terrorist activities and also to launder money in the concerned time for which they were fined.
According to Pearson (2016), the people who were engaged in the case had to face
implications which made it a point for the public relations manager to have a look at the case
and find ways to give the bank a cleaner appearance (Culbertson and Chen 2013).
The public relation management of the bank also help the bank to make sure that their
names and brandings are not affected by the bank in the given period and they have their
business and customer value intact.
7. Press release to the shareholders
Press Release for Commonwealth Bank
Sydney, Australia

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PUBLIC RELATIONS THEORY AND PRACTICE
28th September 2018
The Commonwealth Bank of Australia is deliberately adhering to all the shareholders to
assure that they are not involved in any form of malpractice in relation to the money
laundering scam and the funding of the terrorism act in any way possible. The bank is an
active participant of all the welfare activities of the countrymen and strives to make sure that
they are positively impacting the society. The monetary as well as the financial matters of the
customers are taken as priority and any discrepancy in the matters are strictly seen and
monitored. Each and every person of the bank involved in any sort of malpractice are
punished with legal help to maintain the loyalty with the customers. Due to some of the
unethical people involved in the banking authorities, the bank was scammed to be involved in
the unlawful activities for which serious actions have been taken and ensured that further
such instances would not be tolerated. The press release of the bank is to assure the customers
and the shareholders that all their money are safe and they can maintain their loyalty which is
of prime value for the authorities.
Thank You
8. Recommendations to become ethical and increase the CSR of organization
There are a number of recommendations of the bank to maintain the ethical balance of
the bank and maintain the CSR level in the organization. The recommendations for the
Commonwealth Bank of Australia to maintain the ethical level and the CSR of the bank are
as follows –
 One of the prime recommendations is to maintain a proper public relation
management in the bank and to employ required public relation agents in the due
course of time. The bank should involve more people to increase the loyalty of

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customers in bank and to assure that the customers are fully satisfied with their
business.
 The second recommendation is to communicate with the customers and provide them
with schemes that will be both relevant to them. The corporate social responsibility of
the bank is to maintain the bank and its customer’s level and to give the required
amount of feedback in the course of time.
 The third recommendations of the bank is to employ the public relations theory and
also to see if the bank has any of the accounts which are doubtful and to eliminate
them to maintain the ethical balance of the bank.
 Lastly, the bank should be honest and protect the customer accounts in every way
possible.
9. Conclusion
At the end of the analysis, it can be said that the public relations of the bank is of
utmost importance if the ethical issues as well as the scandals of the concerned bank are to be
analysed. The Commonwealth Bank of Australia is one of the major banks in Australia which
faced a number of ethical and loyalty issues and its overcoming of the senses is being
described in the above paragraphs. The pubic relation of the bank is to be maintained so that
the customers of the bank are not diverted and their image and branding are not hampered in
any sense. The importance of public relations and the way of the bank to make sure that the
bank has ample customer level involvement has been discussed in the bank.

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10. Reference
Botan, C.H., 2017. Theory development in public relations. In Public relations theory (pp. 99-
110). Routledge.
Coombs, W.T. and Holladay, S.J., 2012. Fringe public relations: How activism moves critical
PR toward the mainstream. Public Relations Review, 38(5), pp.880-887.
Culbertson, H.M. and Chen, N. eds., 2013. International public relations: A comparative
analysis. Routledge.
Cutlip, S.M., 2013. The unseen power: Public relations: A history. Routledge.
Doorley, J. and Garcia, H.F., 2015. Reputation management: The key to successful public
relations and corporate communication. Routledge.
Dozier, D.M., Grunig, L.A. and Grunig, J.E., 2013. Manager's guide to excellence in public
relations and communication management. Routledge.
Grunig, J.E., 2013. Excellence in public relations and communication management.
Routledge.
Hendrix, J.A., Hayes, D.C. and Kumar, P.D., 2012. Public relations cases. Cengage Learning.
Johansen, W., Aggerholm, H.K. and Frandsen, F., 2012. Entering new territory: A study of
internal crisis management and crisis communication in organizations. Public Relations
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Kunczik, M., 2016. Images of nations and international public relations. Routledge.
Newsom, D., Turk, J. and Kruckeberg, D., 2012. Cengage Advantage Books: This is PR: The
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Pearson, R., 2016. Beyond ethical relativism in public relations: Coorientation, rules, and the
idea of communication symmetry. In Public relations research annual (pp. 77-96). Routledge.
Pearson, R., 2017. Business ethics as communication ethics: Public relations practice and the
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Qrunig, L.A. and Qrunig, J.E., 2016. Toward a theory of the public relations behavior of
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74). Routledge.
Sheridan, N. and Jang, M.B., 2012. Bank capital adequacy in Australia (No. 12-25).
International Monetary Fund.
Smith, R.D., 2013. Strategic planning for public relations. Routledge.
Theaker, A., 2017. What is public relations?. In The Public Relations Strategic Toolkit (pp.
17-27). Routledge.