Ethical issues and banks have a longstanding relation as it is very important for a bank to maintain its ethical value and represent well in the society. The Commonwealth Bank of Australia, also known as CBA is one of the major multinational banks of Australia that provides a variety of financial and broking services to the people (Grunig 2013). Being the largest Australian listed company, the bank is bounded by law and ethical considerations to maintain its value and be the bank that everyone can trust. The maintenance of the ethical issues will also positively affect the PR of the bank and maintain its balance in the stock market. The following report analyses the repeated scandals of CBA in the PR theory and practise with the stakeholder analysis. The following paragraphs highlight the stakeholder analysis, impact on image and branding, existing barriers, role of PR and press release to the shareholders. The recommendations are also being given at the end of the report.
Public relations is defined as the strategic management of the various forms of communication between the organizations and the general public which are mutually beneficial in the cause as well as the maintaince of their image in the public. According to Dozier, Grunig and Grunig (2013), the work of the public relation of any organization in the bank is to make sure that the image of the organization is built, enhanced as well as protect the reputation in the major span of time. The Commonwealth Bank of Australia has a number of scandals related to money laundering and frauds within the governance of the bank which can be analysed by using various PR theories and practises. The whole issue of scandals can be analysed with the PR theories like the Systems Theory and the Situational Theory (Theaker 2017). The Systems theory is the public relation theory that is involved in the understanding of the relationship between the organization as well as the public whereas the Situational theory of public relations is to maintain the communication between the public and to make sure that their public relation statement are being assessed by the analytical mode of communication.
According to the scandals of the bank, one of the probable causes for the money laundering is the defaulted ATM machines as well as the terrorism financing scandal is the lack of proper guidance in the matters of the financial matters (Hendrix, Hayes and Kumar 2012). The lack of proper working of the ATM machines made sure that the amount of deposits in the bank exceeded the amount of the allocated ones. The terrorism funding of the bank in terms also made sure that the image of the bank was tarnished.
According to the case opinion of Sheridan and Jang (2012), the ATM of the bank accepted anonymous money deposits and withdrawal in whatever fashion and in research it was found that some of the money also went to the terrorist funding which also made the whole image of the bank go withered in the concerned span. Some of the people associated with the bank were terrorist funders that damaged the bank as well as the people associated.
According to the PR theories which dealt with the image funding as well as the consideration of the relation between the parties associated with the case (Pearson 2017). According to the PR theories and practises, the bank is vouched against the terrorism and is expected to act accordingly and in an ethical way which is needed in all organizations.
Stakeholders of the bank are those people who are associated with the bank in both bad and good times and are responsible for the working of the bank both in financial and non-financial terms. The bank has a number of stakeholders who are affected by the scandals which are as follows –
Customers – One of the principle stakeholders of a bank are their customers who are mostly affected by unethical practises as well as scandals of the bank (Grunig 2017). Being the largest bank of the union, the number of customers in the bank is also large which also affect them in a major way. The customers are hampered by the unethical practises of the bank in a major way.
Employees – The employees of the bank are another major stakeholder of the bank who are affected by the scandals as well as the unethical practises. According to Grunig (2017), the employees have their incomes and living associated with the bank which are affected in both ways by the bank.
Shareholders and Investors – The shareholders and investors of the bank are major stakeholders who are affected by the bank. According to Culbertson and Chen (2013), their money and financial status is not hold due to the scandals and lack of ethical issues of the bank which are one of the prime issues of the bank. The investors invest in the bank which make them liable for the financial loss that is there in the bank due to the financial scams.
Industry Associations – The industrial associations of the bank are another major stakeholder who are involved in the financial loss of the bank and also the categorising the bank into the factors of the industry (Coombs and Holladay 2012). The association is liable for the working of the bank and also is a prime stakeholder in the case of the scandal of CBA.
Government – The government is one of the prime stakeholders of the CBA as it is one of the prime banks of Australia which has many government accounts and the sponsored accounts into the realm. The government is liable for the working of the bank in all forms.
The impact of the money laundering as well as the terrorism funding of the Commonwealth Bank of Australia is widespread as it affects the branding as well as the image of the bank in one of the prime ways. The bank is one of the largest banks of Australia which has a number of customers as well as their hopes and trust associated with it (Smith 2013). The bank has a strong public relation business with its stakeholders. The impact on the image and branding of the Commonwealth Bank of Australia in relation to the money laundering scam as well as the terrorism funding scam is of prime value and has affected both the customers as well as the potential investors in some way or the other. The branding of the bank is dependent on the ways and the ethical issues of the self which is again one of the prime ways that the bank has been affected.
The money laundering scam which is one of the prime scams and scandals of the bank in the recent times has impacted the customer satisfaction level and also the working of the brand by the customers of the bank. In addition according to Botan (2017), the impact of the scam on the customer footfall is also negative to the fact that not many customers are opening account in the bank and also are not recommending which affects the business and thereby the profit of the bank in the longer period of time.
There are a number of barriers that are present in the Commonwealth Bank of Australia which can be seen as a hindrance to the working of the bank in one of the major ways in all times. The barriers of the bank are all related to the unethical practises that are present in the bank and also to the recent money laundering and terrorism funding scam that has affected the working of the bank in major times (Johansen, Aggerholm and Frandsen 2012). The analysis of the existing barriers of the bank can be seen in both the in-house governance of the banks as well as the to the external circumstances which are as follows –
One of the major barriers to the Commonwealth Bank of Australia is the barrier to a technological development that has caused the malfunctioning of the ATM machine in the bank and also to the fact that the technology of the bank should be improved to have the required amount of the holding of the customers.
Another existing barrier of the bank is the lack of proper public relationship management of the bank which has affected the reputation as well as the branding of the bank in all the major stocks of the country (Kunczik 2016). The bank which was amongst the top banks of Australia and had a decent position in the country fell drastically into the bottom and made a potential barrier.
The third barrier of the bank is the lack of ethical consideration that is there in the bank in the potential amount of time. The bank being one of the potential places of trust for the customers as it handles their financial security proved to be a barrier as the bank faced issues regarding the ethical behaviour.
The fourth barrier of the bank is the attack of malpractices and people who are not loyal to the bank and were involved in the money laundering and terrorism funding scam in the required period of time (Cutlip 2013).
All these barriers of the bank made the bank have low value in the overall financial market and also to make sure that the customers of the bank have less trust which affects the bank majorly in a number of ways. The crisis of these banks should be managed by both the internal technological and governance changes and also the PR betterment to renew their image in the minds of the customers.
The Public relation process of the bank is one of the major in any case as with the required amount of public relation management in a bank, it is of utmost importance to have the required amount of the public relation status in the organization (Doorley and Garcia 2015). The role of PR in the crisis situation of the bank is of utmost importance as with the required amount of public relations, the bank make it a point to retain its customers and also have the new potential customers who will not be affected by all the past frauds and the mistakes of the bank. The role of the public relations in the crisis of the Commonwealth Bank of Australia are as follows –
One of the major roles of the public relations in the crisis management of the bank is the to justify the deeds that are being performed by the bank in the concerned amount of time. The fraud that is being adhered to the bank for the Commonwealth Bank of Australia desperately needs a public relations management that will help the bank to maintain its brand image in the minds of the public (Culbertson and Chen 2013).
Another need of the public relations is to maintain the goodwill of the bank in the public eye and also to have the required amount of the trust from the public in the concerned amount of time. The major public relation management of the bank is determined by the fraud management of the bank. Commonwealth Bank of Australia has been accused to fund terrorist activities and also to launder money in the concerned time for which they were fined. According to Pearson (2016), the people who were engaged in the case had to face implications which made it a point for the public relations manager to have a look at the case and find ways to give the bank a cleaner appearance (Culbertson and Chen 2013).
The public relation management of the bank also help the bank to make sure that their names and brandings are not affected by the bank in the given period and they have their business and customer value intact.
The Commonwealth Bank of Australia is deliberately adhering to all the shareholders to assure that they are not involved in any form of malpractice in relation to the money laundering scam and the funding of the terrorism act in any way possible. The bank is an active participant of all the welfare activities of the countrymen and strives to make sure that they are positively impacting the society. The monetary as well as the financial matters of the customers are taken as priority and any discrepancy in the matters are strictly seen and monitored. Each and every person of the bank involved in any sort of malpractice are punished with legal help to maintain the loyalty with the customers. Due to some of the unethical people involved in the banking authorities, the bank was scammed to be involved in the unlawful activities for which serious actions have been taken and ensured that further such instances would not be tolerated. The press release of the bank is to assure the customers and the shareholders that all their money are safe and they can maintain their loyalty which is of prime value for the authorities.
Thank You
There are a number of recommendations of the bank to maintain the ethical balance of the bank and maintain the CSR level in the organization. The recommendations for the Commonwealth Bank of Australia to maintain the ethical level and the CSR of the bank are as follows –
Conclusion
At the end of the analysis, it can be said that the public relations of the bank is of utmost importance if the ethical issues as well as the scandals of the concerned bank are to be analysed. The Commonwealth Bank of Australia is one of the major banks in Australia which faced a number of ethical and loyalty issues and its overcoming of the senses is being described in the above paragraphs. The pubic relation of the bank is to be maintained so that the customers of the bank are not diverted and their image and branding are not hampered in any sense. The importance of public relations and the way of the bank to make sure that the bank has ample customer level involvement has been discussed in the bank.
Reference
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