Ethical Banking Case Study

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Ethical Banking: an oxymoron or a change in banking practices required in the twenty first century? In the modern world, financial institutions are being held to strict regulation in a post Global Financial Crisis era yet financial institutions are still outlining their message of strong social responsibility. Is this all a façade or are financial institutions truly holding themselves to the strong message their claim? The pursuit of becoming a good corporate citizen and maintaining an ethical stance is becoming increasingly expensive for businesses worldwide, through issues such as sweatshops, child labour and environmental destruction. As one of Australia’s largest and most powerful financial institutions, the Australian New Zealand Bank (ANZ) stated its “committed to achieving outstanding performance and results to provide value to our shareholders, while considering the interests of employees, customers, the community and others with whom we do business” in Code of Conduct & Ethics(2013, pg. 10). ANZ’s focus on Corporate Social Responsibility (CSR) has come under fire of late due to issues relating to unethical loans and interest rate manipulation in Singapore (Yeates 2013). Banking institutions, much like many global companies, use CSR for many differing reason as a strategic ploy. From this institutions aim to create an equilibrium between the level of resources used in CSR and returns for shareholders .This paper aims to investigate and compare the level of corporate social responsibility and internal ethics in which ANZ claims it holds in high regard with its actual performance, as well look at the wider banking industry choices in relation to the application of CSR and exploring the link and benefit associated with CSR... ... middle of paper ... ...ger dividend returns over the long run as consumers will reward firms by accepting higher prices for these products. ANZ has been able to capitalise on their strong focus to be a good corporate citizen and building a strong reputation through its aims for gender equality and donation partnerships of over $52.6 million in 2013 (ANZ: Giving, 2013) In recognition of their strong CSR and ethical banking practices it has enable ANZ to earn profits over $6.49 billion dollars in the 2011-2012 financial year (ANZ Shareholders report, 2013). The clash between profits and CSR may not be all that is seems, when firms become conscious of the positive effect the CSR can have on profit, more firms may increase the level of CSR. ANZ holds itself to strict guidelines on its own CSR and for the most part does achieve this objective which has enabled build ANZ’s strong reputation.

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