Code of ethics for an organisation determine the effective and non-effective processes that must be undertaken in regards to the employees and consumers (Yasir et al., 2016). It address the ethical components of discrimination, corruption, dishonesty and fraudulent behavior. Moreover, it also address the aspects of exploitation and whistleblower protections within an organisation. The Westpac is one of the most influential Australian bank which provide a large number of financial services. It is the first bank that provide financial packages to the customers in order to support the corporate and personal banking needs. The bank has its headquarters at the Westpac Place in Sydney. It have been tolerating a culture of greed, and misbehavior in the employees since long time. Moreover, it has been found to be engaged in biggest violations of money laundering laws for almost 23 million times. It is important for an organisation to be engaged in ethical code of conduct in order to prevent any type of misconduct and violations to the laws. Aim of the assignment is to produce code of ethics that discuss the aspects of exploitation, corruption, discrimination, enforcement and dishonesty. This assignment explains the scandals in which the bank was involved in addition to the ethics and codes that that must be developed for the bank to prevent such scandals in the future.
The Westpac is one of the most promising bank in Australia and it provide financial services t to both personal and cooperate banks on large scale (Johnson, 2019). The bank had a very positive image in the Australian market but then it got engaged in certain unethical, illegal and scandalous activities which impacted its image throughout the world. The bank was accused of breaching money-laundering laws for almost 23 million times which was not only legally incorrect but also ethically faulty (Johnson, 2019). The bank failed to report more than Australian $11 billion of payments through bank-to-bank system which was developed to transfer pension funds (Johnson, 2019). The most serious scandal in which the bank was engaged was based upon the technology of LitePay. It was a consumer product which made for sending small amounts of money. However, Westpac failed to maintain proper diligence with 12 consumers with transitions marked as red flags. One of the transition was even involved with person in Philippines that was engaged in child trafficking and exploitation of minors. Westpac is in serious need of an ethical code of conduct because of its inability to manage scandals within the organisation. An ethical code of conduct would be effective in providing clear and consistent values for the organisation. (King, 2020)
According to Kosny, Santos and Reid (2017), Australia is a country with diverse cultural groups which can bring up discriminatory events within an organisation. These discriminatory events involve bullying, exclusion and lack of opportunities to the disadvantaged group of the society (Kosny, Santos & Reid, 2017). Mistreating small business owners is often considered as a type of discrimination. It has been seen that people in power are highly recognized in the society in comparison to people that are not in power (Gutmann, 2018). The ethical code of conduct for discrimination suggest the employees and the management of an organisation to comply with the laws and policies of the organization. The staff members are expected to respect each other irrespective of the financial status or extent of power. It is the responsibility of every employee within the organisation to understand the needs of the consumers irrespective of their culture or differences and work with best possible interventions. An organisation with equal opportunities, participation and recognition leave discrimination behind (Gutmann, 2018). It expect the staff members to work in effective teams while considering every consumer as individual and important.
Exploitation is one of the most serious concern in both national and international market (Larsen et al., 2018). It is very likely for an organisation or authority to be engaged in unauthorized or exploiting activities involuntary. Both direct and indirect activity that lead to some kind of exploitation is considered as unethical. Even though ethical exploitation of a person can bring up serious consequences but legal exploitation of a person can bring up strict law suits and disciplinary actions (Lu Jin, Zhou & Wang, 2016). For example: the Westpac was not directly involved in the exploitation of the minors in Philippines but it had to face serious consequences because of its indirect involvement with the customers that were directly involved in the trafficking. Had the organisation been attentive toward the frauds and the use of the services offered to the consumers then the bank would have been saved from the obligations. The technology of LitePay was basically a consumer product which made for sending small amounts of money among different people. However, Westpac failed to maintain proper diligence with 12 consumers with transitions marked as red flags. The ethical code of conduct suggest the importance of maintaining diligence within the functions of the organisation (Lu Jin, Zhou & Wang, 2016). According to Provan, Rae and Dekker (2019), diligence is an important attribute of professional practice which require the workers to have careful and persistent working skills toward the activities of the company. Diligent workers are conscious toward the ethical and unethical activities that are happening within or outside the organisation with the resources of the organisation (Provan, Rae & Dekker, 2019). Having diligence within the work culture can lead to positive outcomes and legal practices within the organisation.
According to Amiram et al., (2018) corruption is considered as a dishonest and fraudulent activity that often involve bribery and misconduct to steel money from the legal owners. The Westpac was involved in the biggest money laundering laws in the history of the country. The bank’s chief executive as well as the chairman of the bank had to leave their job because of their involvement with child pornographers. The company reported to have a culture of greed in which the employees used to misbehave in case of fewer profit. It is important for a company to have an ethical culture free from corruption, greed and misbehaving. The financial crime agency court reported that the Westpac breached the legal aspects of business and the senior management was involved in indifferences and inadequate oversight by the board. The bank was also involved in a money-laundering fraud for 23 million times which was a legal concern.
It is important for an organisation to have knowledge regarding money laundering and the criminal charges related to money laundering and criminal enforcement. According to Karpoff (2020), it is considered as a criminal activity to be engaged in any kind of virtual transition in which the funds are transferred for a certain criminal activity or unlawful activity. The money laundering activities involved in drug trafficking, terrorism, fraud and child trafficking can be a cause of severe corruption and greed. The ethical code of conduct for maintenance of greed and corruption can include the aspects of awareness, enforcement of lawful activities, strict rules against corruption (Karpoff, 2020). Following strict rules against corruption can develop fear among the people engaging in unlawful activities and this can in deed result in safe and ethical functioning of the organisation.
It has been reported that the employees of the Westpac were engaged in poor financial advices. They used to advice the consumers to choose services that were best for their own interest in spite of the interest of the consumers. The ethics expect the employees to provide best possible services to the employees irrespective of their own interest and profit. It is expected from the employees to be considerate and empathic toward the consumers (Smith, 2017). They must be informed about the strategies that are best effective for their needs in spite of the incentives the employees earn with other programs. The Westpac reported that the employees often failed to honor insurance claims to the consumers and they used to push customers in bad investments to meet the bonus targets. The Australian biggest banks were responsible for almost 80% of the country’s loans which bought up severe financial crisis.
The company was engaged in various scandalous activities that involved manipulation of the benchmark interest rates. Every person does not have similar financial status. It can be difficult for small business owners to meet heavy benchmark interest rates and this can be highly discouraging. According to the Australian laws, it is unlawful for an organisation to enhance the interest rates to the set rates by the government. This can lead to lawsuits and court cases (Chien et al., 2018). The ethical code of conduct suggest an organisation to have an ethical committee that monitors the fraudulent and dishonest behavior of the employees. The ethics must contain aspects of honesty and encouragement. An honest employ motivates a number of other employees to engage in ethical and lawful activities that are best effective for the consumers. Setting up an ethics committee with proper code of conduct for managing dishonesty and fraudulent behavior can lead to fulfillment of working ethics in the organisation.
It has been seen that a number of employees are made to resign earlier or forced out from the job because they report fraud, dishonesty and faulty process within the organisation (Gino & Ariely, 2016). This is one of the most common reason due to which employees do not inform the government or criminal agencies about any fraud or scandalous activity that takes place within the organisation. An act specified for the Whistleblowers protection within the organisation can prevent jobs and career of a number of employees and it can also enhance safety within the workplace (Gino & Ariely, 2016). An idea of being caught can minimize the extent of scandalous activities within the organisation. A number of employees within the senior management were impacted by the Westpac bank exposure. An act specifically designed for the beneficence of the whistleblowers can be effective for the ethical code of conduct. The act must contain aspects which prevent the employees that expose an organization involved in any kind of criminal offence can be effective in ethical management.
Enforcement of both positive and negative practices within an organisation can result in changed practices within the workplace (Petitta et al., 2017). The employees within the Westpac bank were enforcing policies and services to the employees which were not really beneficial for them. They were basically doing it for increasing their bonus. It is important for an organisation to have an ethical code of conduct that respect the choices and practices of the consumers while motivating the consumers to choose best possible services. According to the aspects of ethical beneficence the laws and rules that ensure safety within a workplace must be enforced.
It can be concluded that the Westpac is a successful financial bank in Australia. The bank is engaged with a number of clients nationally and internationally. However, it was engaged in a number of scandalous activities which led to various ethical and legal violations. Findings of the assignment indicated a need of effective ethical code of conduct for the Westpac. The bank was accused of breaching money-laundering laws for almost 23 million times which was not only legally incorrect but also ethically faulty. Moreover, the bank failed to report more than Australian $11 billion of payments through bank-to-bank system which was developed to transfer pension funds. The bank was engaged in a number of scandalous activities that led to discrimination, frauds, corruption, injustice and exploitation. The corrupt senior officials were indirectly involved in child trafficking and exploitation which bought up serious consequences for them on being exposed. Ethical code of conduct that contain aspects of proper reporting for misconducts and activities for preventing discrimination can bring up positive results for the company.
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