FNCE90057 - Ethics in Finance: CSR Program Evaluation of St. George

This report provides a comprehensive evaluation of St. George Bank's Corporate Social Responsibility (CSR) program, examining its benefits, motivation, commitment, strategy, implementation, and performance. It highlights how CSR enhances the bank's sustainability through media coverage, customer retention, brand differentiation, and alignment with environmental norms. The report analyzes St. George Bank's CSR practices, noting its community investment programs, commitment to lower interest rates for sustainable housing, and participation in environmental initiatives. Furthermore, it explores ethical theories such as utilitarianism, ethics of rights, contractualism, and stakeholder theory, applying them to St. George Bank's CSR practices to provide an ethical perspective on the firm's social responsibility efforts. The report concludes by summarizing the bank's CSR performance and its alignment with ethical principles.

Running head: ETHICS IN FINANCE
Ethics in Finance
Name of the student:
Name of the University:
Author note

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Table of Contents
Introduction:...............................................................................................................................2
Benefit of utilising CSR program by the bank:..........................................................................2
Evaluation of CSR program of St. George bank:.......................................................................4
Motivation:.............................................................................................................................4
Commitment:..........................................................................................................................4
Strategy:.................................................................................................................................5
Implementation:.....................................................................................................................5
Performance:..........................................................................................................................5
Four ethical theories:..................................................................................................................5
Explanation of St. George bank’s CSR practice with ethical theories:......................................8
Conclusion:................................................................................................................................8
Reference:..................................................................................................................................9

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Introduction:
Corporate Social Responsibility (CSR) is one of the long standing commitment of the
Australian banking industry, which is aimed to provide better performance bonus to the banks
while providing more exposure towards the market. CSR review of the banks provide a solid
ground to the policy makers to assess the performance of the same from the perspective of the
different indicators ranging from environmental factors to governmental aspects as well as it
includes the social factors of the business too (Schwartz, 2017). Firms nowadays are
producing their CSR as per the Global Reporting Initiative (GRI) that define the quality of
the content available within the report and ensure the validity of the same. This report is
aimed to provide an evaluation of the CSR program of the banking sector and for better
understanding it will consider an Australian bank (Tai & Chuang, 2014). As the selected bank
for this report, St. George Bank is chosen, which is one of the largest lending business
banking firms in Australia presently operates under the Westpac Group since 2008.
Introduced back in 1937, chosen organisation has made a solid customer base within the next
50 years of introduction and during 1992 it achieved its full banking status making it one of
the largest lenders in the Australian market (St. George Bank, 2018). Through this report
CSR of the firm will be evaluated and the performance of the bank depending upon the CSR
disclosure will be analysed. While doing so, the report will focus on the importance of
utilisation of CSR program by the bank and then it will portray how the CSR of St. George
operate in terms of motivation, strategy, commitment, performance and other factors. Post
this, the report will discuss the ethical theories of the CSR and utilise the same on the St.
George Bank for explanation of the firm’s CSR performance depending upon the ethical
theories.

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Benefit of utilising CSR program by the bank:
Utilising the CSR, over the years has become one of the biggest importance to the
sustainability of the firm because it helps the firms from different aspects ranging from the
social responsibility to the environmental responsibility. When it comes to the banking sector,
then it can be seen that the, CSR program aids the banks to get proper exposure and optimal
valuation of the social responsibilities being an important part of the social sphere within the
economic framework of a state (McWilliams, 2015). Besides these, there are various other
benefit of utilising the CSR program and some of them are mentioned below:
Media coverage and customer retention: One of the main reasons that allows the firms to
perform CSR on regular basis is that it allows them to gain much amount of media coverage
and focus more or customer retention allowing better sustainability of the operation of the
firm (Suliman et al., 2016). CSR enabled the firms, specially the banks to provide bilateral
service to the customer, where one sphere is focused to provide smooth performance and
service to the customers and the other one is focused on providing added benefit to the
consumers.
Brand differentiation: CSR is one such thing that allows the firms to operate under the
predefined rule of operation allow them to enhance the scope of future sustainability while
maintain the economic and commercial balance within the operational framework of the firm.
All the firms do not opt for the CSR program owing to their inability to act according to the
CSR guideline (Carroll, 2015).
Alignment with the environmental norms: CSR program enables the firm to operate as per
the regional environmental laws that showcase the social responsibility of the firm. In
addition to performing as per the social responsibility framework of the firm will allow the
same to have better alignment with the environmental rules leading to fall in the carbon
footprint produced by the firm (Pedersen, 2015).

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Considering the same it can be seen that, CSR is one of the important factors that
determine the sustainability of the firm because with the better exposure to the market and
better customer retention policies with adequate amount of alignment along with the
environmental rules will allow the firms to gain much amount of sustainability. Considering
the case of the chosen bank, it can be seen that it has been performing CSR since two decades
and the firm has identified the CSR as one of the main instrument that can enhance the
performance of the firm as well as provide better sustainability scope through operating as
per the CSR framework (Bhattacharya et al., 2017). In addition to this, it has also been seen
from the firm’s operation that, it has kept community above all and importance towards
environment as well as business principle based upon the ethics and good governance has
made it to perform CSR on daily basis and gain sustainability. Below section will analyse the
performance of the firm and portray how St. George Bank has done CSR program.
Evaluation of CSR program of St. George bank:
Motivation:
St. George bank over the decade of performance has established a well-defined
market within the operational boundary of the firm and transformed itself in such a way that
it is focused to provide support to the Australian community as well as better environment to
the same. Motivation of the firm lies within its commitment to provide better living, greener
environment and sustainable community that makes it stand out from the crow (Clapp &
Rowlands, 2014). Community investment program performed by 400 branched of the firm in
all over Australia provides the ability to act as per the motivation of the firm (St George bank,
2018).
Commitment:
St. George is committed to provide lower interest rate loans for the house making
with the Greener Dragon loans and thus it is committed to provide availability of easy fund

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which will help the Australian economy to become sustainable. In addition to this, it can also
be seen from the perspective of the firm that has committed to provide better environment to
all by reducing the paper works that will eventually reduce the cutting down of trees.
Participating in Earth Hour program and reduced energy usage are the commitments by the
firm (Economic, currency and other reports, 2018).
Strategy:
Being one of the well famed bank, St. George has different set of strategies than
others. It focus on the CSR publication and frequent publication of their financial
performance report that provide them clarity and transparency in their business that ha
attracted a large number of population toward the same.
Implementation:
As far as commitment and strategy is being conserved, then it can be seen that the
firm comply with the same by the means of performing earth hour and switching off the
unnecessary street lighting. In addition to this, it can also be seen that St. George firm utilise
the low interest rate loan strategy to attract customer and for the retention purpose it often
provide discounts on the ongoing repayment schedule.
Performance:
Performance of the firm during 2017 has been moderate. Though there has been
reduction in net profit by 7%, yet number of dividends has enhanced and the cash earning of
the firm has been soaring (Westpac.com.au, 2018).
Four ethical theories:
CSR is one of the integral and essential part of the corporate development and
sustainability that largely depends on the economic performance; however, it provides equal
amount of importance to the environmental, social as well as the philosophical performance
of the firm that bring in the ethical theories of CSR within the operational framework of the

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CSR practise. ethical front of the CSR entails that the self-consistent and cogent theoretical
background and answers the question that how much business cost will the firm is affecting
of the society of by how much social performance is affecting the performance of the firm
(Wagner & Disparte, 2016). Though there are large amount of theories regarding the same is
available, yet only four mainstream theories have been chosen for this report. Four ethical
theories are namely, ethics of rights, utilitarianism, contractualism and stakeholder theory.
Considering the importance and the magnitude of their presence within the ethical framework
of the CSR practice, these four theories have been chosen and a brief overview of the same is
given below:
Utilitarianism: It is one of the simple morale theory that depicts moral agents such as firms
need to maximise the total sum of well-being so as to enhance the social performance of the
same. by the means of social performance, this theory depicts the all human being within the
regional and geographical framework of the firm where it is operating and through
maximisation of the total sum of well-being, Utilitarianism explains there is no scope for the
economic agents to perform below the maximum socially optimised level of performance
because it will rather than enhancing the overall performance of the firm will decrease the
same (Brief et al., 2018). In addition to this Utilitarianism considers categorical constrains
against the harmful action and rejects the same under forces labour work, biasness among the
workers, race or gender based discrimination and in other cases where ethical principles get
hampered. Thus, Utilitarianism constrains the firms to perform harmful action like bribery,
forced labour work, discrimination among the workers, biased resource distribution and
others and secondly by the means of ensuring socially optimised performance it enables the
firms to operate as per the CSR framework that focus on enhancement of the social well-
being through the performance of the firm (Spence, 2016).

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Ethics of rights: Often argued as the deontological theory of ethics, it is one such ethical
principal that propose the morality consists more than the promotion of the goods and
services produced by the firm. There are many actions taken by the firm, which are morally
wrong and yet they get promoted due to the overall higher revenue generation by the firm and
similarly there are many plans to the economic agents that can enhance their well-being and
reduce the overall economic performance as well as growth of the firm. under this situation
ethics of rights showcase that there is duty of care that both the agent of the economy need to
take care off in order to have better social well-being (Harrison et al., 2015). Though the
ethics of rights argue opposed to the Utilitarianism, yet it is true that some sort of conflict of
morality between the two agents of the economic framework is present. Additionally it can
also be seen that ethics of rights is specifically important to the global scenario, where firms
operate in different region and face different business environment that often lead to the
ethical dilemma for both the economic agent. Though CSR include the ethics of rights by
abiding the social well-being enhancement norms, yet a question regarding the following of
the procedure and evaluation of the same is often under scrutiny from the competent authority
(Schlegelmilch, 2016).
Contractualism: It is a developed and upgraded version of the ethics of rights and
Utilitarianism though it has well defined affinities towards the initial one. Main idea of the
Contractualism lies within the normative truths and normative relevant proposition that
procedurally defined as the result of the hypothetical agreements between the economic
agents. It has become one of the mainstream ethical principal of the CSR that defines the
importance of entering into contract between the parties so as to avoid future consequences
(Thijssens et al., 2015). As far as CSR is concerned, contractualism emphasise on the issues
like mutual acceptability and reciprocity of the firms value as well as the reasonability of the
same. Thus it provide firms two options, either to enhance the performance with most costly

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option available to reduce the social burden of the firm or it can go for cheapest option in
order to enhance the output while putting burden on the society as well as environment.
Stakeholder theory: One of the most important ethical theory that acts as the mirror to the
CSR. Instead initiating the ethical consideration from the firm and ending with the business is
not the basic idea of ethical consideration within the social framework, rather it starts from
the world and jot down to the individual group draining better performance of the CSR.
Stakeholders’ ethics can star operate once the stakeholders of the firm are identified and
collective bottom line of the firm’s action is decided (Scherer, 2018).
Explanation of St. George bank’s CSR practice with ethical theories:
Considering the CSR practice of St. George Bank of Australia, it can be seen that the
bank perform CSR as per the guideline and there is strong linkage between the operational
framework of the firm and the ethical consideration of the CSR practice (St.Geroge Bank,
2018). Above analysis has also shown that ethical consideration in CSR is important and
considering the same, it can be argued that the chosen organisation depends upon the
Utilitarianism and ethical theory of stakeholder for their CSR because they want to provide
the best well-being to the society through their contentious and rigorous performance. It has
enhanced their capability to perform as per the CSR guideline and enforced the bank to keep
account of their environmental performance so as to provide better customer ambience.
Conclusion:
From the above discussion it has been seen that, St. George bank is one of the well
maintained and well developed lending firm in Australia that has been performing CSRV
since last two decades. With the help of the CSR framework the report has performed
evaluation of the performance of the firm and has found that it has been operating properly.
Moreover, it has been found that the firm is operation as per the ethical theories of CSR that
makes it stand out from the crowd. thus to conclude, it can be said that operational framework

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of the St. George bank has followed the CSR framework and has made itself sustainable for
the coming days.

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