ANZ Banking Group Limited: A CSR Analysis And Governance Structure

Corporate Social Responsibility (CSR)

Discuss about the Social Responsibility Of International Business.

Corporate Social Responsibility (CSR) is a concept of management. The companies concern societal and environmental concern in their business by using CSR practices. The CSR makes possible to achieve a stability between social, economic and environmental imperatives. The CSR practices also address the expectations of shareholders and stakeholders. The CSR plays a significant role in every company. Nowadays CSR is the biggest requirement of business. These are the initiatives taken by the company to look after the environmental and social wellbeing. The CSR is helpful in improving the reputation of business in the competitive market. It is not possible for a company to survive and grow without practicing corporate social responsibilities.

The report focuses on the CSR activities and governance structure of ANZ Banking Group Limited. It includes Carroll’s Pyramid and Wartick and Cochrane’s Typology. ANZ is analyzed towards it’s response to key stakeholder expectations. The gaps are highlighted between the adopted and realized performance on CSR.

The Australia and New Zealand Banking Group is commonly known as ANZ. It was formed in 1951. ANZ is the third largest bank in Australia as per the market capitalization. It also ranks as one of the top hundred financial services companies. The group provides retail banking services in Australia and New Zealand. The bank serves 4 million customers over a network of 900 branches and more than 1500 ATMs. The bank also conducts additional operations in the Asia-pacific region. Other products and services of the bank are mortgage financing, consumer financing, wealth management, corporate banking, investment banking and more. The Australian division of bank comprises of retail, corporate, commercial banking and business units. The New Zealand division consists of trade and commercial business units.

The CSR approach adopted by ANZ is to make a maintainable and positive impact in the lives of employees, customers, societies, shareholders, and environment. It is about ensuring that business is accomplished to take account of social, environmental and economic risks and opportunities. The business can generate and sphere value for customers by undertaking CSR factors into consideration (Jain, Keneley & Thomson, 2015). The group targets and corresponds a platform of work to upkeep delivery of business strategy (Islam, Jain & Thomson, 2016). Such practices help the group to achieve the vision that is to grow into the most trusted and esteemed bank of Australia and New Zealand. The group aims at generating social impact along with building CSR for leveraging the expertise. ANZ mainly focuses on the customers to make difference in these areas:

ANZ Banking Group Limited

ANZ earns trust by keeping pace with the varying expectations of stakeholders. It maintains high standards of conduct and understands the impact of business decisions on social and environmental. It also assists people in getting affordable and fair financial services. 

The group believes in developing strong customer relationships. It connects with societies by assisting a varied and comprehensive society in which everyone participates. ANZ works with different partners to address enormous issues of society (Laczniak & Murphy, 2014).

ANZ creates opportunities for all the customers. It also enables sustainable growth opportunities for individuals, business, and industry. The group also addresses the opportunities and risks arising due to change in climate. The overall aim is to achieve sustainable growth by minimizing negative impacts on the environment.

The Carroll’s CSR Pyramid is a framework which is helpful to the organizations in meeting social responsibilities. The CSR first focuses on profits then ensures all the laws and regulations. It is a four-layered pyramid model which is also called a pyramid of responsibilities (Linnhoff, Martin, Smith & Smith, 2014). As per the Carroll pyramid, an organization has 4 types of responsibilities given below:

The first responsibility is to become economic. The economic responsibilities of ANZ are to turn out more profitable, make strategic decisions and reduce costs. The second is the legal responsibility which focuses on obeying law set required by the society. The third responsibility is linked to the second which is ethical responsibility. It requires the company to behave ethically by practicing the activities which are relevant to the group in order to avoid maltreatment (Larrán Jorge, Andrades Pena & Muriel de los Reyes, 2015). The fourth is a philanthropic responsibility which is on the top of the pyramid. It entails a group to perform the role of a good corporation by undertaking steps and the refing the quality of life of community.

ANZ has established it’s foundation along with the accomplishment of economic responsibilities. When the group was capable to accumulate adequate profits with the minimum costs then it lead towards the responsibilities. The group has set up an audit committee in order to fulfill legal responsibilities. This committee is responsible for safeguarding compliances with the prevalent laws, rules, and regulations. The bank aims at the values to fulfill it’s ethical responsibilities to guide behavior and decision-making process. The values are integrity, collaboration, accountability, respect, and excellence. The integrity concentrates on doing what is right. The collaboration connects and works as one at the organization. The accountability reflects to own actions and make it happen. Respect is the view of customers towards the group. Finally, the excellence brings the best, helps people to grow and be business minded (Kolk, 2016). The bank fulfills the philanthropic responsibilities by undertaking diversity and enclosure at the workplace. It also promotes gender equality.

ANZ’s CSR approach

The analysis made by Carroll connecting to CSR was forward-looked by Wartick and Cochran. This model imitates the collaboration between the practice of social awareness, principles of social responsibility and the policies which are advanced to address social issues. This framework in the context of ANZ Banking Group Limited reflects that efforts are made by the group to bring positive change in the society (Herbohn, Gao & Clarkson, 2017).

The group has benefitted by having access to the new markets and supporting long-term business growth. The group has also made a contribution to support low carbon economy and address climate change. ANZ has started a pilot program in the garment sector of Cambodia. It has also launched WING to help the workers particularly middle and low-income customers. After one year, the group made WING available to all Cambodians.

The governance framework of ANZ provides a compact structure for the effective and responsible decision making. It provides the oversight from the Board on the risks and prospects rising from the activities of the bank.  The governance structure of ANZ comprises of the parties which enhances the accountability of stakeholders and shareholders (Davidson, Wreford, Penter & Perrin, 2017). It also ensures the accurate revelation of material facts and maintenance of the business reliability and ethics.

The board of ANZ monitors acquiescence with the regulatory and legislative requirements, internal policies, and ethical standards. The corporate responsibility and performance of ANZ rest with the board. The board is having the majority of independent non-executive directors who are good at skills, expertise, and experience from various backgrounds. The bank has established five committees to assist the board in exercising authority. All committees of bank meet at least quarterly accept governance committee. It meets twice a year.

A number of committees have been established by ANZ to effectively carry out the responsibilities. These committees are:

Audit committee: The audit committee is liable for the omission and assessment of financial reporting principles, strategies, principles and processes (Ogunfowora, Stackhouse & Oh, 2016). The committee is responsible for the effectiveness of the accompanying internal control and the risk management framework.

Governance committee: The governance committee is chaired by the chairman of ANZ who analyses and approves the government policies and principles. The committee is also responsible to review and approve corporate sustainability framework and the annual sustainability targets. The progress of group is regularly reviewed against the achieving standards (Rice & Peter, 2015). The committee is also responsible to monitor diversity policy as it related to the board. The gender diversity objectives are also approved by it.

Carroll’s CSR Pyramid

Human resources committee: The human resource committee supports and creates endorsements to the board linked to the matters of remuneration and the senior executive progression (Mewafarosh & Naeem, 2016). It also has oversight of the policies and procedures related to the people. It monitors performance regarding health and safety issues, employees’ engagement and workplace culture.

Risk committee: The risk committee administers the management of emerging risks. It risks also includes social, environmental and reputational. The committee commends the risk appetite and conducts oversight role with respect to risk management strategies and compliance of ANZ.

Technology committee: The technology committee commends and monitors the performance against the information technology strategy of ANZ Banking Group Limited. The information technology strategy of the group includes IT security strategy (Painter-Morland & Spence, 2014).

The effective engagement with stakeholders is an significant part of ANZ. It is surrounded into policies, process and processes of ANZ. The organisation responds to the stakeholder expectations through the stakeholder engagement policy which is applied to all the staffs and pursues to sustain a structure approach. It is made possible through the presence of clear communication channels, clear possession and accountability of relationship (Shim & Kim, 2015). The engagement process is planned in such a way that they have direct access to ANZ and allows company to resolve issues. The organisation also takes into consideration the stakeholder’s concern at the time of taking long term strategic judgements. The organisation’s stakeholder engagement ideologies are reliable with the AA1000 stakeholder engagement standard.

ANZ responds to key stakeholders in an organised way. The global leaders are assigned for each group of stakeholders and relationship owners for the key stakeholders. The personnel and contractors respond to stakeholders on the behalf of ANZ. The relationship owners have responsibility for the company’s engagement with stakeholders. The stakeholder engagement model are developed and maintained and the procedure to control and support it (Vilar & Simão, 2015).      

Some gaps are there in the adopted and realized performance on CSR by the ANZ Banking Group Limited. The aim of ANZ is to make a sustainable and efficient contribution towards business, people and communities who are responsible for the success of bank (Weijo, Martin & Schouten, 2014). The employee engagement is less which is just 72% and required to be increased in order to resolve issues of customers and stakeholders. The female representation is also very less which is just 38.7% and is required to be increased in order to maintain gender equality at workplace (Setó-Pamies & Papaoikonomou, 2016).

Wartick and Cochran’s CSR framework

ANZ have over 47,000 employees across 33 countries. The figure is required to be increased in order to achieve objective of creating a stronger community by supporting indigenous success. The economic contributions made by ANZ are greater than the financial profits. The number of small loans and facilities offered in the villages are required to be increased (Rupp, Wright, Aryee & Luo, 2015). However, there is still need to contribute more towards society by recovery from the trauma and fulfilment of needs and requirements.

Conclusion

From the above report it can be concluded that ANZ is aiming to be an efficient corporate by fulfilling it’s responsibilities towards society. The CSR activities of ANZ banking Group Limited includes assisting customers in recovery from financial tremors and supports indigenous success. It also addresses society concerns such as gender disparity and domestic fierceness. It also discourses the risk of climate variation and the required phases to minimize the influence on the environment. The analytical contexts like Carroll’s Pyramid and Watrick and Cochrane’s typology have been applied by the ANZ. The governance structure ensures that several committees have been framed to certify overall compliance. However there are some gaps in the practices of CSR which are still requisite to be met.

References

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