Detailed Analysis on Westpac bank code of ethics

Question

Task:You are required to research recent news articles and other information about Westpac Bank.

Here is an example of a recent news article describing some of the corporate governance issues at Westpac Bank:
https://www.bloomberg.com/news/articles/2019-11-27/why-heads-are-rolling-at-another-big-australian-bank-quicktake

You must then draft a Code of Ethics for Westpac Bank

Answer

The present study sheds light on the Westpac bank code of ethicsin an effective manner. Westpac banking corp. is one of four leading banking institutions in Australia. It is the oldest company and the first-ever bank that started its operations in Australia. Currently, Westpac also happens to be one of the leading banking institutions in New Zealand. The afore-named bank commenced its business operations in Sidney in the year 1817. It was formerly known as the Bank of New South Wales. This banking organization provides financial services and serves a varied range of clients and customers like multi-national companies, small and medium businesses, and government institutions (Westpac Bank 2020). The achievements of the afore-named bank are countless and so are the controversies associated with the name of the same. This second-largest banking institution of Australia has been accused of acting against the counter-terrorism finance laws and anti-money laundering laws not just once but 23 million times. The penalty imposed for each breach amounts to a$63,000. Lack of Westpac bank code of ethics and the failure in its implementation has probably led to all these controversies. This report aims at drafting the Westpac bank code of ethics by specifically addressing aspects of the below-mentioned points:

a. Discrimination
The total strength of employees working in Westpac bank until the year 2018 was over 35,029. Looking at the success of Westpac bank, it can be concluded that the number of employees working in the same is growing year after year. Managing such a large workforce is not that easy at all. Discrimination is one of the most common problems faced by employees in an organization and this is more prominent in large business organizations. Employees are often discriminated against on the basis of factors like age, gender, attributes, sexual orientation, race, color, designation, and marital status (Walsh 2014). Seniors discriminate their juniors by favoring a certain group of employees over others owing to reasons stated above. The adversities of discrimination practices begin with hampering relationships between employees and ultimately disrupt the peace and wellbeing of an organization. Discrimination initiated by seniors results in providing promotion, rewards, incentives, appreciation, growth, and hikes to undeserving employees over deserving ones. Discrimination practices taking place between employees can lead to the formation of different groups in a single department. The results of discrimination practices always against the wellbeing of an employee and organization too irrespective of the fact which actually initiates and conducts such disturbing practices. The scandals of the Westpac bank code of ethicsconfirm the presence of such practices taking place in the organization and therefore, its management must design anti-discrimination policies at the earliest. The management must carefully evaluate the level of discrimination prevailing in the afore-named banking organization and must accordingly design effective anti-discrimination policies for the successful abolishment of such unacceptable and unfair practices from the same. The management must design suitable strategies and policies to ensure that there are an equal opportunity and respect for all despite their age, gender, caste, creed, color, education background, designation, and marital status. Promotion, growth, incentives, appraisal, and increment in the organization must be provided to employees solely on the basis of their dedication, discipline, knowledge, talent, level of engagement, performance, skills, ability, and willingness to learn (Westpac Group 2020). The afore-named banking organization must also necessary ensure that these policies are effectively implemented for guaranteeing their success percentage and attaining desired results out of them.

b. Exploitation Policy
Employee satisfaction is the key to the success of an organization. Fair treatment of employees is very crucial for the wellbeing of an organization and its attainment of long-term and short-term goals and objectives. Organizations, where employees are given the worst possible treatment, might earn profits in the present but might end up becoming insolvent in the future (Schwartz 2016). The exploitation of employees can take place in various forms. Companies might make their employees work in an unsafe environment where there is always a risk of life or an unhealthy environment where there are higher chances for the employees to fall sick. Tedious work hours, less pay, overtime with minimal or no pay at all, and child labor are some of the most common forms of exploitation practices undertaken by business organizations. The exploitation of employees in any form is unacceptable and in most cases punishable by law. The exploitation of children who are lower than a certain age is no less than a crime. Undertaking such malpractices can impact a company’s brand image along with Westpac bank code of ethics and its existence (Westpac Group 2020). Westpac bank code of ethics must ensure that its employees are fairly treated in terms of health, hygiene, safety, security, work hours, and salary. The banking organization must ensure that its employees receive fair wages and are treated with a lot of respect and dignity. Westpac bank code of ethics must ensure to design suitable anti-exploitation strategies and policies for curbing out such practices that result in the exploitation of employees (Westpac Group 2020). Such policies and strategies must be compulsorily followed by each and every employee of the afore-named organization. The management of the organization must also necessarily ensure that the afore-mentioned policies are strictly followed and complied by the employees and the incidence of exploitation of employees is minimized or abolished totally. These measures will confirm employee satisfaction and simultaneously the company will grow and rise above all obstacles.

c. Corruption Policy
Corruption activities are quite prominent and can be easily undertaken in a large organization where there are thousands of employees. Corruption activities in a banking organization can take place in the form of bribery, money laundering, data manipulation, misuse of data for fraudulent activities, and insider trading. These practices are devastating for any organization as it can end up losing its profits, customers/ clients, brand image, reputation, and can even face severe legal consequences (Fiolleau& Kaplan 2016). In banking organizations, corruption practices are performed by their employees and the consequences of the same are dealt with by the organizations, innocent employees, and their clients/ customers. Profound anti-corruption policies can disallow the employees to perform such unacceptable practices in the name of the organization. The senior management of the Westpac Banking Corporation must learn from the past incidences and construct effective measures for combating such mishaps taking place in the organization. As discussed in the report earlier, Westpac bank code of ethics was allegedly found to have actively participated 23 million times at least in corruption practices like money laundering and counter-terrorism finance laws (Johnson 2019). This would have been impossible in the presence of strong implementation of anti-corruption laws in the organization. Therefore, the management of the afore-mentioned bank must not only focus on designing suitable measures, policies, and strategies but also ensure that these are strongly implemented for overcoming the corruption activities prevailing in the company. The previous allegations and scandals have already shattered the image of the afore-named banking organization into a zillion of pieces and only sound development and implementation of anti-corruption measures can help the company in earning back its customer's trust and boosting its business again.

d. Dishonest and Fraudulent Behaviour
Employees are the pillars of a successful organization and sometimes, these pillars can have cracks too. The dishonest and fraudulent behavior of employees is always a matter of concern for any organization irrespective of its size. The intention and activities of employees can do wonders and even create disasters for organizations (Burke &Tomlinson 2016). There are many instances where the employees are often found to commit fraud in the organization. It is not easy for the recruiters to detect the dishonesty and fraudulent mindset of potential candidates prior to hiring them. It is also not possible for companies to totally eliminate the occurrence of such activities in an organization. But it is totally possible to identify and monitor areas that are prone to foul practices. Therefore, it is highly critical for an organization to have sound policies in place to eliminate or minimize the outcomes of such behavior of employees. Fraudulent behavior and dishonesty have always been a matter of concern for organizations. The dishonesty of employees can create huge troubles for the organization. For a banking organization like Westpac, the dishonest and fraudulent behavior of employees can strongly take place in the form of misuse of the client’s confidential data, its manipulation, and its unauthorized transfer. Such dishonest employees can initiate a lot of scams in the name of Westpac bank by fooling its clients and customers. Dishonest and fraudulent behavior is a potential threat to the wellbeing of an organization and it can even cause the same to disintegrate due to the loss of customers’ faith and business. Westpac bank code of ethicsmust construct suitable measures through which the unjust intentions of fraudulent employees remain unsuccessful. This banking corporation must ensure that the employees having fraudulent and dishonest behavior are identified and immediately thrown out of the organization. Such employees must not be rendered a second chance and Westpac bank code of ethicsmust immediately disassociate itself from such criminals. The senior management of Westpac bank code of ethicsmust also make sure that these policies are known and mandatorily complied by all the employees of the bank and if an employee intentionally fails to adhere to these policies, then such an employee must be immediately terminated from the organization.

e. Whistle-blower Protection
A whistle-blower is an individual who speaks up against the heinous activities taking place in an organization. A whistle-blower may not always be an insider. He or she can also be an outsider. The only thing that qualifies for an individual to become a whistle-blower is the information that he or she carries. The identity of a whistle-blower is kept confidential for ensuring that he does not face any sort of pressure or life risk in the future. The failure to hide the identity of a whistle-blower can cost impose a huge threat to his or her life. In this context, there are a few aspects that an organization must take care of while protecting a whistle-blower from future consequences that might arise only if his or her identity is revealed to a third person. Westpac bank code of ethicshas a lot of scandals and controversies in its name. The past of this bank highlights the unjust practices that were taking place in the organization and also, does not confirm if such foul practices were just a thing of the past. The afore-named bank must come up with policies in order to protect the identity of its whistle-blowers from getting revealed to any third person. Westpac bank code of ethicsmust compulsorily take strong legal actions against such employees or individuals who are found violating the whistle-blower identity protection policies. Taking legal actions against such individuals will set a strong example for others who are willing to act against the whistle-blower protection policy.

f. Enforcement
Enforcement policies are also an important aspect of Westpac bank code of ethics. Enforcement policies have a lot to do with ensuring a hundred percent adherence to various requirements may it be policies, norms, laws, regulations, standards, policies, procedures, or rules (Andon, Free& Scard 2015). These policies enable the companies in detecting the areas where there is a strong probability of violation of the requirements to take place. These policies will also allow the companies to identify areas where the violation of norms, laws, policies, and procedures have already taken place. These policies are generally integrated into enforcement matters. Alterations to these policies can only be made by taking a compulsory approval from the company’s Board of Directors. The top-level management of Westpac must design effective enforcement policies for ensuring that the employees duly follow each and every aspect of the Westpac bank code of ethics and compulsory adhere to all the policies and measures that aim to combat foul practices and activities like corruption, fraudulent and dishonest behavior, exploitation, discrimination, and harm caused to whistle-blowers. If the intentions and activities of an employee are apparently found to act against the interest and welfare of the company, then he or she must be expelled immediately and must also be sued with a legal notice at the earliest. The afore-mentioned banking organization must construct and strongly implement suitable enforcement policies and must also ensure to educate the employees of these policies from time to time.

References
Andon, P., Free, C. and Scard, B. (2015). Pathways to accountant fraud: Australian evidence and analysis.Westpac bank code of ethicsAccounting Research Journal, 28(1), 10-44.

Burke, R. J., and Tomlinson, E. C. (2016). Crime and corruption in organizations: Why it occurs and what to do about it. London, United Kingdom: Routledge

Fiolleau, K., and Kaplan, S. E. (2016). Recognizing ethical issues: An examination of practicing industry accountants and accounting students. Journal of Business Ethics, 1-18. DOI:10.1007/s10551-016-3154-2

Johnson, E. (2019). Why Heads Are Rolling at Another Big Australian Bank. Retrieved from:https://www.bloomberg.com/news/articles/2019-11-27/why-heads-are-rolling-at-another-big-australian-bank-quicktake

Schwartz, M. S. (2016). Ethical decision-making theory: An integrated approach. , 139(4), 755-776.

Walsh, J. (2014). The Role of Ethics in a Future Accounting Career. Embry-Riddle Aeronautical Industry

Westpac Bank. (2020). Company overview. Retrieved from:https://www.westpac.com.au/about-westpac/westpac-group/company-overview/

Westpac Group. (2020). Human Rights Position Statement and 2020 Action Plan. Westpac bank code of ethicsRetrieved from:https://www.westpac.com.au/content/dam/public/wbc/documents/pdf/aw/sustainability/ Human_Rights_Position_Statement.pdf