Code of Ethics.
The Common Bank of Australia (CBA) recently faced criminal charges over a fraud scandal. The reputation of the organization was greatly affected. The bank faced similar allegation due to misconduct of the employees. Therefore, it become necessary to draft and implement code of ethics that assures prevention of such malicious behaviour of the employees and maintain the ethical values. This report suggests a draft for code of ethics for the bank employees to avoid discrimination, exploitation, corruption, dishonesty and fraudulent behaviour and ensure enforcement of this code.
The discrimination on the basis of gender, religion, ethnicities, and nationality is common at workplaces among employees. The bank system is often found to show discriminatory behaviour towards less privileged customers by excluding them from mainstream financial stream (Kamran & Uusitalo, 2018). Any kind of sexual, sexist or racist comment, joke and speech is a form of discrimination. If any employee or customer found violation in non-discriminatory behaviour, they must immediately report it to the concerned authorities.
Exploitation can be in the form of sexual, bullying, and overburdening employees. To protect all the stakeholders in every situation, the employees must adhere to the standard of behaviour on duty and off duty (BCMM, 2019). Any employee must be careful and avoid engaging in such activities. The bank may suspend or fire if such misconduct is found.
Private financial institute gain confidence in financial market through an efficient and transparent monetary interaction (Worika & Ozuru, 2020). Banks are often found guilty in money laundering. Such act may result into imprisonment of the guilty. The bank must be transparent and accountable for all the monetary transaction. Any employee found violating anti-corruption code, must be severely punished or expelled.
When employees show dishonest behaviour or similar illicit forms of behaviour, trust and cooperation is broken and cost of rule enforcement and monitoring increases (Olsen et al., 2018). Therefore, dishonest behaviour creates a negative impact on the reputation of individual as well the organization. The Bank and its employees must be honest and transparent in their behaviour, to avoid customer dissatisfaction and increase mutual cooperation.
The CBA has already defamed for fraudulent behaviour for selling insurance policies through unsolicited phone calls. This behaviour is the root cause of reviewing the code of ethics of the Bank. To protect the organization from such unethical behaviour which depicts social irresponsibility, the implementation of code of conduct is necessary. The individual involved in violation of the code of conduct often jeopardize the reputation of the organization (Irlenbusch et al., 2020).
If any employee witness violation of code of ethics, they must immediately speak up. Whistleblowing by employees help in uncovering corporate frauds. Whistle-blower can be internal (who blow the whistle to someone who is a part of the organization viz director, senior manager or CEO) and external (who blows the whistle to someone outside the organisation) (Park et al, 2018). A study conducted in the US showed that 17% of the cases of fraud by the company was disclosed by their employees (Mechtenberg et al., 2020). Since, whistle-blowers play a very risky and crucial role, they need strong protection. They are prone to workplace bullying or threatening (Park et al, 2018). Many times, whistle-blowers are subjected to dismissal from offices or exploited by their supervisor and colleagues.
The whistle blowers must be provided with added security after they discloses any fraudulent scandal. Policies have been developed in many nations for the protection of whistle-blowers. Australian Security and Investment Commission (ASIC) have released two information sheet under the Corporation Act (2001):
Some of the methods to enforce code of conduct are as below:
Communicating and educating employees about the code of ethics. The employees must be made aware about the code of ethics and its importance. The moral values in employees must be cultivated to ensure avoidance of violation of code of ethics.
Motivating employees to follow codes of ethics. The motivation can be in the form of words of appreciations or reward. Those employees who shows good performance as well as ethical behaviour must be consider for appraisal. Employees who speak against violation of code of ethics must be supported and appreciated for their courage and moral sense.
Harsh punishment for those who violates code of ethics. These punishment can be in the form of salary deduction, suspension from duty, permanent dismissal and legal charges.
This report discussed about various type of violation in code of ethics in a bank. The discriminatory, dishonest and corrupt behaviour shown by employees have direct impact on organization’s reputation, customer satisfaction and market trust. The CBA faced many legal charges due to the misconduct and fraudulent behaviour of the employees. Therefore, it is essential for the bank to implement the above suggested code of ethics in order to prevent unnecessary issues and scandals. The whistle-blower protection is discussed. The Australian government made included whistle-blower protection instruction in the Corporate Act. The enactment of these code of ethics is the most important and crucial in determining the outcome of the codes. The four methods of enactment have been suggested; motivating employees, communicating and educating employees about the code of ethics, harsh punishment for violators and legal charges against severe violators.
Board, B. C. M. M. (2019). Code of conduct. BC Milk Marketing Board.
Irlenbusch, B., Mussweiler, T., Saxler, D. J., Shalvi, S., & Weiss, A. (2020). Similarity increases collaborative cheating. Journal of Economic Behavior & Organization, 178, 148–173. doi:10.1016/j.jebo.2020.06.022
Kamran, S., & Uusitalo, O. (2018). Banks’ unfairness and the vulnerability of low-income unbanked consumers. The Service Industries Journal, 1–21.doi:10.1080/02642069.2018.1436704
Mechtenberg, L., Muehlheusser, G., & Roider, A. (2020). Whistleblower Protection: Theory and Experimental Evidence. European Economic Review, 103447.doi:10.1016/j.euroecorev.2020.103447
Olsen, A. L., Hjorth, F., Harmon, N., & Barfort, S. (2018). Behavioral Dishonesty in the Public Sector. Journal of Public Administration Research and Theory.doi:10.1093/jopart/muy058
Park, H., Bjørkelo, B., & Blenkinsopp, J. (2018). External Whistleblowers’ Experiences of Workplace Bullying by Superiors and Colleagues. Journal of Business Ethics. doi:10.1007/s10551-018-3936-9
Whistleblowing. (2020). Australian Securities and Investements Commission. Retrieved from https://asic.gov.au/about-asic/asic-investigations-and-enforcement/whistleblowing/
Worika, I. L., & Ozuru, G. (2020). Good Governance Conundrum: Beyond A New Generation Of Freedom Fighters/Anti-Corruption Fighters In Nigeri. International Journal Of Comparative Law And Legal Philosophy (Ijocllep), 1(3).
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