Westpac Bank Ethical Practices And Ethics ✓ Solved

WESTPAC BANK ETHICAL PRACTICES 14 Westpac Bank Ethics and Culture: Students

Westpac Banking Corporation, established in 1817, is one of Australia's oldest banking institutions. With a global presence including branches in London, Singapore, Hong Kong, and New York, Westpac employs over 34,000 individuals. Ethical practices and organizational culture are fundamental to its daily operations. Transparency and ethical conduct help prevent immoral activities, uphold the bank’s reputation, and ensure sustainability. Despite its efforts, Westpac has faced ethical challenges that have impacted its operational integrity and public image.

In the banking sector, success is not solely defined by financial performance but also by organizational culture, management philosophy, and ethical practices. Good relationships with employees and customers motivate stakeholders and contribute to growth. Ethical practices heighten organizational decision-making efficiency and foster employee loyalty, which in turn enhances organizational performance. Conversely, unethical behavior can tarnish a bank's reputation, deter customers, and harm long-term sustainability. Transparency about organizational challenges and ethical compliance is therefore crucial for maintaining trust and investor confidence (Bowie, 2017; Trevino & Nelson, 2016).

Westpac has experienced scandals and ethical breaches, including allegations related to interbank rate manipulation and dismissals linked to expense claims. Such incidents have alarmed employees, leading to turnover and a decline in workplace culture. These issues underscore the importance of corporate social responsibility (CSR) and the implementation of ethical theories—such as virtue ethics, deontological and teleological ethics—to guide behavior and decision-making (Moroko & Duffy, 2016; Carrol et al., 2014). Addressing these ethical lapses involves strengthening policies that promote honesty, accountability, and ethical leadership.

However, barriers to ethical practices persist. Instances of workplace bullying and managerial neglect discourage employees from voicing concerns or adhering to ethical standards. Lack of effective leadership exemplifies how leadership behavior influences organizational culture, often hindering the promotion of ethics (Chell et al., 2016). Such cultural issues adversely impact the bank's financial position, decreasing profitability and customer satisfaction. Recent financial reports indicate reduced profits, decreased dividend payouts, and increased debts, which are partly attributed to unethical behavior and its repercussions (Lee, 2017; Ford & Richardson, 2013).

The decline in customer satisfaction has damaged Westpac’s public image, as evidenced by lower consumer ratings compared to smaller banks. Unethical practices and scandals reduce customer loyalty, leading individuals to shift to competitors perceived as more trustworthy. Reports also suggest that Westpac's corporate social responsibility (CSR) efforts have been insufficient to counteract the negative perception created by its ethical lapses. CSR initiatives—such as environmental sustainability and community engagement—are vital for rebuilding trust, aligning with global standards like the Global Reporting Initiative (Carrol & Buchholtz, 2014; Leonidou et al., 2018).

To address these issues, Westpac must prioritize comprehensive reforms. Conducting a need analysis reveals the importance of embedding ethical practices throughout the organization. Strategies should include ethical training programs for employees, fostering a culture of integrity and accountability. Regular evaluations of ethical standards, at least quarterly, can monitor progress and identify areas needing improvement (Moroko & Duffy, 2016). Leadership should exemplify ethical conduct, actively promoting transparency and responsible governance models (Chell et al., 2016).

Implementing stronger CSR policies is pivotal. Westpac should expand initiatives supporting social and environmental sustainability, aligning with global commitments like climate action and responsible finance. Collaborations with other organizations can amplify ethical standards and enhance reputation. Additional employee training on the code of conduct and ethical decision-making can further reduce scandals and improve customer confidence (Carrol et al., 2014; Moroko et al., 2016). Transparency and open communication about ethical challenges and achievements are necessary to rebuild trust among stakeholders.

Long-term success depends on cultural transformation driven by top management. Management must actively participate in policy implementation and uphold high ethical standards, influencing organizational behavior positively. Addressing unethical practices linked to corporate governance, CSR, and internal culture is essential for restoring Westpac's market position and public trust. As suggested by recent studies, integrating ethics into strategic planning and daily operations results in improved financial performance, enhanced reputation, and sustainable growth (Lee, 2017; Bowie, 2017).

Sample Paper For Above instruction

Westpac Banking Corporation exemplifies a major financial institution grappling with the challenges of maintaining ethical practices and organizational integrity. Established over two centuries ago, Westpac's historical significance and global presence underscore its influence in the banking sector. However, like many large organizations, it faces ongoing ethical dilemmas that threaten its reputation and long-term sustainability. This paper explores how Westpac’s ethical practices have evolved, the barriers it encounters, the impact of unethical behavior on its financial and reputational standing, and the strategic measures necessary to reinforce an ethical culture.

Fundamentally, success in banking extends beyond profit margins; it encompasses fostering a corporate culture rooted in integrity, transparency, and stakeholder trust. Ethically driven organizations tend to outperform their counterparts because ethical behavior enhances decision-making efficiency, employee commitment, and customer loyalty (Chell et al., 2016). Conversely, unethical practices—such as manipulative trading behaviors or discriminatory workplace conduct—can erode stakeholder confidence. Such breaches not only impair operational performance but can also lead to legal penalties and loss of market share (Bowie, 2017).

In Westpac's case, scandals related to interbank rate manipulation and wrongful dismissals have prompted scrutiny of its corporate governance and internal controls. These incidents exemplify how ethical failures can emerge from organizational culture deficiencies and lack of oversight. Applying ethical frameworks like virtue ethics and deontological principles can serve to reconceptualize behavior, emphasizing moral virtues and duty-bound responsibilities. These theoretical lenses promote accountability and conscientiousness among staff and leadership, fostering a culture of ethical excellence (Moroko & Duffy, 2016).

Addressing barriers to ethical conduct is critical. Evidence indicates that organizational environments characterized by bullying, managerial neglect, or ambiguity undermine ethical standards. When employees perceive an absence of support or fairness, they are less inclined to act ethically, leading to misconduct and decreased morale. Leadership plays a pivotal role; leaders who model ethical behavior and enforce consistent policies set the tone for organizational culture (Chell et al., 2016). Effective leadership and clear communication channels are thus essential in promoting ethical vigilance and responsiveness.

The financial ramifications of unethical conduct are significant. Recent reports indicate that Westpac’s profitability has declined, with profits falling short of expectations, partly due to diminished customer trust and increased operational risks. The decline in customer satisfaction, as well as a rise in negative perceptions, diminishes revenue streams and hampers investor confidence. Additionally, increased debts and reduced dividend payouts reflect the economic toll of ethical lapses. These financial strains underscore the importance of maintaining high ethical standards to secure sustained profitability (Lee, 2017; Ford & Richardson, 2013).

Reputational damage is another consequential effect. In a highly competitive environment, customer loyalty hinges on perceived integrity and ethical conduct. The lowering of consumer confidence and satisfaction ratings highlights the urgency for strategic reforms. Comparative studies reveal that smaller banks often outperform larger institutions in customer trust, partly because they are perceived as more ethical and transparent. Consequently, Westpac must reinvest in its CSR initiatives, emphasizing social responsibility and environmental stewardship, aligning with international standards such as the Global Reporting Initiative to demonstrate accountability and commitment to ethical practices (Carrol & Buchholtz, 2014; Leonidou et al., 2018).

Strategically, a multi-faceted approach is recommended. Initial steps include a thorough ethical needs analysis to identify gaps and areas for improvement. Ethical training workshops for all employees can bolster understanding of compliance standards, ethical decision-making, and responsible conduct (Moroko & Duffy, 2016). Regular evaluations—at least quarterly—can track progress, identify recurring issues, and reinforce accountability. These assessments will foster an organizational culture that prioritizes continuous ethical improvement (Chell et al., 2016).

Leadership must actively participate in implementing and monitoring ethical policies. Building an ethical governance framework with clear codes of conduct, whistleblowing policies, and accountability measures is essential. Such governance strategies have proven effective in banks and financial institutions worldwide, leading to improved ethical standards and stakeholder trust (Carrol & Buchholtz, 2014). Strengthening CSR efforts—such as environmental sustainability projects, community engagement, and responsible finance initiatives—can also signal the bank’s renewed commitment to ethical principles (Lee, 2017).

Transparency in reporting and open communication about both successes and setbacks are vital to rebuilding trust. Stakeholders, including customers, investors, and regulators, assess a bank’s integrity through its disclosures and actions. Incorporating external audits and third-party evaluations, such as those performed by KPMG, can further enhance credibility and ensure compliance with global ethical standards (Leonidou et al., 2018).

In conclusion, the path to restoring Westpac’s ethical standing involves organizational reforms, leadership commitment, and cultural transformation. By embedding ethics into its core operations and expanding CSR initiatives, the bank can mitigate past misconduct's adverse effects, improve financial performance, and regain stakeholder trust. These efforts require a sustained commitment to moral principles, transparent practices, and stakeholder engagement, which are integral to a resilient and responsible banking institution.

References

• Bowie, N.E. (2017). Business ethics: A Kantian perspective. Cambridge University Press.
• Carroll, A., & Buchholtz, A. (2014). Business and society: Ethics, sustainability, and stakeholder management. Nelson Education.
• Chell, E., Spence, L. J., Perrini, F., & Harris, J. D. (2016). Social entrepreneurship and business ethics: does social equal ethical? Journal of Business Ethics, 133(4), 589-603.
• Ford, R. C., & Richardson, W. D. (2013). Ethical decision making: A review of the empirical literature. In Citation classics from the Journal of Business Ethics (pp. 19-44). Springer Netherlands.
• Lee, N. (2017). Walking the second mile before the first: A corporate social responsibility conundrum? In Stages of Corporate Social Responsibility (pp. 67-89). Springer International Publishing.
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• Moroko, L., & Duffy, S. (2016). Trashing the brand: ANZ and CBA could pay a high price for choosing profit over people. The Conversation, 18.
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• Standard and Poor's. (2019). Westpac Banking Corporation financial report 2018-2019. S&P Global Ratings.
• Trevino, L. K., & Nelson, K. A. (2016). Managing business ethics: Straight talk about how to do it right. John Wiley & Sons.