Liability For Business Laws And Ethics: A Comparison Of Commonwealth Bank Of Australia And Coca Cola Amatil

Differences between the two companies in terms of social reports and depth of coverage on special issues

Discuss about the Liability for Business Laws and Ethics.

Australian Corporate Bodies have been able to ground themselves well, not only in national markets but also in the global market on the basis of a strong economic infrastructure. The Commonwealth Bank of Australia, playing an exceptional role in developing the banking sector in Australia, is a bank in the general sense of the term; however, it is more than that. According to Commbank.com.au, (2016) The Commonwealth Bank of Australia is involved in several major economic pursuits such as retail, developmental investment, share market investment and superannuation. Developing within the boundaries of the continent it its initial stages, Commonwealth Bank of Australia has now expanded its business in the global market especially in Asia, North America, New Zealand and Europe. The Bank, despite its impressive portfolio does come with couple of issues. Chan, Watson & Woodliff, (2014) state that at times the Commonwealth Bank of Australia has failed to meet norms determined for the opportunity to innovation motto, mentioned in their company policies at the time of balancing with profit making.

Coca Cola Amatil is one of the most dominating and profiting corporate body, dealing in the food and beverages. Established as a tobacco company in 1904, the company has a long way to expand its reach in various ways and in the 1960s it took its current shape as it bought the Coca Cola bottle manufacturers. The company deals mostly in the local market, having more than a 20 manufacturing facility and warehouses. Being a part of the food industry the Coca Cola Amatil has inclined towards a few essential corporate social responsibilities. The Coca Cola Amatil aims at providing good quality products, better lifestyle to the extreme possible point. In recent years as mentioned by Andini & Simatupang (2014) it has faced many challenges in the market; nevertheless it has faced no serious issues regarding the nutrition values of the beverage that is produced in mammoth numbers, keeping in accordance to the predetermined social corporate responsibilities (Ccamatil.com, 2016).  

As suggested by Cheng, Ioannou & Serafeim, (2014), the social corporate image of any corporate organization casts influence on the mindset of the general populace, channeling the business accordingly and the Australian corporate bodies are no exceptions to this. The norms mentioned and followed by certain corporate bodies are mentioned in their respective social responsibility reports. Dhaliwal et al. (2012), suggest that these reports are made easily accessible to the public with the sole intention being developing a positive atmosphere for business in the guise of mentioning certain roles taken up by the corporate bodies besides earning profit. In the current assignment the chosen organizations are not similar and have different social priorities, resulting in two different social corporate reports. The Commonwealth Bank of Australia highlights its dedication to the development of the education, innovation and good business practices around the globe. The chosen bank has mentioned details about cases where the investment plans have resulted in enhancing the standard of education and innovation. The reports give details about the future assumptions and aims foreseen with believe to bring in a positive change. It is worth the mention that the Commonwealth Bank does not disclose the details about the profits it has secured out of the mentioned cases.

Explanation of the differences from different aspects

The corporate social report presented by Coca Cola Amatil focuses mainly on the wellbeing of the consumers, improving living standards by integrating communities and preservation of the environmental balance. The social report mentions all the activities and survey results that show that Coca Cola Amatil has retained the standards expected on the part of the customers. The report also mentions the company’s aim in integrating the social fragments with the promotion and popularity of their products on a global scale, especially in Australia. Fogel & Elizabeth (2014), mention that the corporate social report of the chosen organization also unfolds details about its manufacturing processes that are less harmful to the environment and are on the verge of bringing in remarkable business standards. A minute observation of the report shows that there is very little importance given to activities that benefit the society directly.    

The Commonwealth Bank of Australia and Coca Cola Amatil are two very different corporate bodies in terms of presence in the market and nature of business policies. The reason behind such differences is easy to comprehend. Huang Zhou & Zhu (2012) are of the opinion that a close research on the working framework of the Commonwealth Bank of Australia shows that it has its business expanded beyond the national boundaries of Australia. On the other hand the Coca Cola Amatil generally manufactures in Australia and exports its products to other countries. Brailsford, Handley & Maheswaran (2012) highlighted that as the Commonwealth Bank of Australia competes in the national as well as in the international investment market it has to emphasize the power of its investment and mention the best interest of men. As the banking sector is very competitive in its nature, the chosen bank has to mention the its social responsibilities in order to create an unique identity for itself. Contrasting starkly to banking sector, the Coca Cola Amatil produces beverage and also indulges in the packaging of the beverages. According to Ouppara & Sy (2012), as the beverages are related to the health and the manufacturing is associated with the idea of environment, the corporate social responsibilities of the mentioned organizations mainly revolves around preservation and environment and health standards. As the banking sector is the work field of the corporate persons and the main is corporeal development of the society the norms of Commonwealth Bank of Australia’s corporate social responsibilities are less inclined towards nature and health. Coca Cola Amatil products are used generally for regular purposes and is related to issues of food, health and environment, therefore, the chosen organization lays very little emphasis on innovation, education and development of business.   

In order to provide a proper and effective guideline for corporate organizations to frame their respective corporate social reports the 8 criteria of Zedak et al. (1997) has been considered appropriate. The extent to which each chosen organization have followed the 8 criteria has been discussed in the table below

Criteria	Coca Cola Amatil	The Commonwealth Bank of Australia
Inclusivity	A Sharpe observation and inspection of the organization’s working framework show that the organization has developed a good interaction system, thereby justifying the principle of inclusivity in their social report.	The organization follows the mentioned criteria in its social report as it provide its stockholders a good communicative system integration.
Comparability	Coca Cola has been conducting comparative surveys of its product and services over time and has benefitted itself and improved significantly. This criterion is also included in their social report.	The bank has developed annual reports in order to compare the statistical data for the betterment of the organization making it evident that the organization is following the mentioned criteria.
Completeness	This criterion has not been followed by the chosen organization at the time of framing the social report.	The organization has not followed the criteria of completeness. The organization is does not include the factors of exceptional talent promotion and employee environment.
Evolution	Coco Cola Amatil has learnt consistently from the market and has evolved accordingly. Therefore, the mentioned criteria are present in their social report.	The chosen organization has evolved over the years to keep up with the global competitors.
Management Policies and Systems	Apart from the management of the labor in some production facilities, the organization has abided by the mentioned criteria.	The social report presented by the Commonwealth Bank of Australia meets the mentioned criteria as it gives ample details about the managing system of the organizational body.
Disclosure	The terms that involve the benefits and the risks of the business have not been given much importance.	The organization follows the criteria of disclosure in a partial manner for there is evidence that the organization hides certain risk factors.
External Verification	Coca Cola Amatil conducts external verification on regular intervals to get unbiased rating.	The bank does not conduct external verification.
Continuous Improvement	The packaging segment of the organization has gradually improved yet the in order to maintain authenticity the beverage processing is kept as stock as possible.	The Commonwealth Bank of Australia has adapted the methods of banking transaction and investment from other banks over the years and in this process it has continually updated and improved itself.

Table 1: Explanation of social accounting approach by Zedak et al. (1997) for both the companies

Explanation of social accounting approach by Zedak et al. (1997)

(Source: Gray et al. 1997)

Thus, it has become clear that both the organizations have been able to follow a proper social accounting approach which resembles the social accounting approach of Zadek et al. (1997).  Further, it becomes clear that following the principles of Zadek et al., organizations can be able to have continuous and non constrained growth in their respective industry.

The corporate social reports presented by organization are meant to provide an overview of the organizations contribution towards the society. Frias?Aceituno, Rodriguez?Ariza & Garcia?Sanchez (2013), going in further depths, argue that the details provided in the reports should always follow certain rules; however, in some cases breaching of rules can be seen. The official website of the Commonwealth Bank of Australia shows that the bank has taken up great responsibilities and has made them an integral part of their social responsibilities. Khan, Muttakin & Siddiqui (2013), is of the opinion that the sole focus lights up positive change in the educational sector and modern innovation as a result of the health and generous investment policies. Sadly, there are references to more than one case that show that Commonwealth Bank of Australia has rejected requests of capital investments for innovation as well as educational infrastructure development as the projects held less scope for profit in their disposal. Based n the existence of such cases at hand, it becomes very clear that the Commonwealth Bank of Australia’s social report is not valued by the organization itself and the terms are taken up lightly. As suggested by Fooks et al.  (2013), as the chosen organization plans to enhance the rate of good practice in business and boast innovation it has to shift its focus a little from making profit only.

The Coca Cola Amatil does not proved big promises or social bindings in their corporate social report; still the organization has been very successful in retaining the standard with not a single failure or breach of policies. As seen on the company website, detailed social reports are uploaded and are kept for public display. Servaes & Tamayo (2013), mention that the reports incorporate details about the company statistics which in terms give a very similar, if not perfect description of the company. The detailed reports show the non business activities, realistic figures and envision future goals on a very realistic basis. Judging from the working technique of the organization and its social reports it can be ascertained that Coca Cola Amatil value their social report to a very large extend. 

In the course of the assignment I took the help of internet and logged into the official websites of the two chosen organization. The corporate social reports provided on the part of both of the organization were enriched in details and were sufficient to form the primary assumption about the level of value, nature of roles and the difference in policies. Being a team of five members I had four other members who helped me in reaching a proper conclusion. My initial assumptions about the chosen organizations was supported by all of them, nevertheless all of them raised question about the social report provided by the Commonwealth Bank of Australia. Some of our team members went on to general queries on the internet and eventually found that the bank has been not abiding its own set of policies for the larger share of profit. As per Shaw & Barry (2015), the main purpose of business is to secure profit and for profit and welfare could cause trouble. I argued on the basis of the above mentioned suggestion to defend my initial assumption. In retaliation of my argument I was told that the rejected projects and breached terms had the potential to be avoided if only the Commonwealth Bank of Australia could give relaxation to their margin of profit. According to Henderson (2015) for the larger benefit of the society profitability can be relaxed to a considerable degree and hence needs commitment of the organization. Other members of our team pointed out that Coca Cola Amatil has abided to its social responsibilities as a result of which it has secured less profit in certain cases. I also realized that the figures provided in the Commonwealth Bank of Australia’s social reports were unrealistic in some cases. Based on these arguments and evidences I considered the opinions of my team mates to be proper and just. I changed my initial assumptions and succeeded in establishing a concrete conclusion.   

Reference list:

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