Sustainability And Accountability Framework For Bank Australia

Question:

Discuss About The Challenges Remain After Marriage Equality?

A sustainable enterprise can be defined as a business which takes into account such processes that creates minimal negative impact on the local or global environment, society, community or economy. In other words, a sustainable business is the one that strives to meet the triple bottom line

 The maintenance of a monitoring system is done by the high level managers of the organization who possess special skills for maintaining it. The different dimensions of an organization are represented in the various aspects of the monitoring system namely socio- cultural, economic and environmental dimension which can be measured by effective indicators.

This report focuses on the three dimensions of sustainability namely socio- cultural, economic and environmental of an enterprise which is a bank in Australia named ‘Bank Australia’ along with the detailed description of the enterprise, application of these sustainability indicators to the enterprise and the list of indicators which can assist in the monitoring of the specified dimension.

Bank Australia, formerly known as bankmecu and earlier to that, the Members and Education Credit Union (mecu), is a Kew, Victoria based Australian financial co- operative. Bank Australia is recognized to be a customer owned responsible bank which operates in a business for the purpose of creating mutual prosperity for the communities they operate in, their customers and the planet (Bank Australia, 2018). The profits made by the bank are invested back for the purpose of providing various benefits to their own customers in the form of fairer fees and better interest rates. The customers have been banking with Bank Australia since 1957 and therefore Bank Australia has a rich history of 60 years.

The customers of Bank Australia prefer it over other banks due to its personal service and competitive prices. Moreover, Bank Australia is renowned due to its progressiveness and genuineness in terms of mirroring their values while playing an important role in building a fair, strong nation and a healthy planet. Now Bank Australia has become a bank which all Australians can call their own.

Bank Australia has various branches located all around Australia and provides the facility of banking online and over the phone. There are more than 3,000 rediATMs of Bank Australia all across the country. It has now become the choice of nearly 1,24,000 customers and community sector organizations for their banking needs across Australia.

PESTLE analysis

Banking services are offered to hundreds of charitable funds, NGOs and community groups by Bank Australia. In addition to providing products and services of great value, investment of 4% of its after tax profits are made into the Bank Australia Impact Fund which provides funding to the projects having quantifiable impact on planet, people and prosperity. Their present areas of priority include gender equality, non- profit/ social enterprise, environmental sustainability, disability, reconciliation and educational disadvantage.

Moreover, Bank Australia also makes investment in partnerships in order to support those fund projects which address educational disadvantage along with the professional development of education professionals. It has also established partnership with CSIRO with the view to support the access of science education by indigenous students along with the provision of scientific calculators to the disadvantaged students by their State Schools Relief funding

The strengths, weaknesses, opportunities and threats faced by Bank Australia are presented below-

The strength of Bank Australia lies in the responsible banking performed by it. It is preferred by the customers due to its personal service and competitive prices. Along with banking activities, it also takes steps for creating a healthier planet. It leads the banking industry as a carbon neutral bank and takes steps to reduce the environmental impact by offsetting the carbon emissions associated with car loan of every customer.

Bank Australia is still not popular among the people residing in Australia even after 60 years of its operations. The earlier name bankmecu was also confusing and did not appeal to people. It is not able to attract new customers due lack of recognition among people. Therefore, the profitability of the bank does not stand in comparison with the other banks in Australia.

The latest technological development provides opportunity to Bank Australia as it can help in providing easier and safer banking options to the customers. Various initiatives undertaken by Bank Australia in the form of Reconciliation Action Plan, Disability Action Plan and denial of loans to fossil fuel industry is an opportunity and will assist in the sustainability of the bank in long run.

The growth of the bank can decline due to weak economic outlook. Lack of Investor confidence can affect the profits and the banking activities of Bank Australia. Non-fulfillment of obligations by counter party can result in default risk for the bank.

PESTLE Analysis acts as a strategic tool for the purpose of determining the macro- economic factors impacting the banking industry and includes political, economic, social, technological, legal and environmental factors.

Dunphy's Phase Model

The banking sector is significantly affected by the government laws including a lot of intervention in the matters of banking by the government. Therefore, this leaves the banking industry susceptible to political influence. Such political influence includes corrupt political parties, tariffs, political stability and the impact of the
The banking industry is affected by changes in the savings rate, inflation rate, foreign exchange rate, interest rates and the economic cycle as these factors determine the aggregate demand and investment in the economy. Moreover, the competitive advantage of a bank is also impacted by the competition norms.

The attitudes and beliefs of the population impact the banking industry as they desire ease in their banking experience. Banking industry is also affected by the social factors such as demographics, culture, skills and education level of the population. Their behaviors and necessities affect their way of viewing the banking options.This factor covers the technological developments made by the competitors of Bank Australia and the impact of such technology on its operations. It also includes the impact of value chain structure and cost structure in the banking industry. Technological developments are increasing in the industry in order to provide easy handling of funds to the customers.

The banking industry is required to comply with the consumer laws, trade structures and respect the privacy of the customers. It also needs to comply with employment law, discrimination law, health and safety law and anti-trust laws with regard to the banking industry. Also, the banks need to comply with the other regulation for the protection of environment.The mobile apps and online banking services have contributed towards the less use of paper along with the reduction in pollution due to minimization of need to drive to the branches. The individual environmental footprints are being reduced.

The Sustainability phase model developed by Dunphy provides six developmental phases which can be utilized as a tool for the purpose of evaluating the current commitment of an organization along with the habits related to ecological and human sustainability. The phases are rejection, non-responsiveness, compliance, efficiency, strategic productivity and sustaining corporation.

Bank Australia is approximately a 60 year old bank but has still not gained much recognition in Australia. Its customers are increasing day by day but there are still many who are unaware regarding the existence of this bank.

The complete focus of Bank Australia is on the creation of mutual prosperity of the community, its customers. However, the knowledge of sustainability of Bank Australia is more in the social aspect and less on the environment and economic aspect. The sustainability measures with regard to the social aspect include keeping employment in Australia, Disability action plan, Reconciliation Action Plan and the support for marriage equality.

Key Sustainability Indicators

The review of Bank Australia recommends that it is in the middle of Dunphy Phase 2 and 3 i.e. Non-responsiveness and Compliance. Therefore, it needs to take measures in order to move towards Phase 5 Strategic Sustainability and further towards the ideological scenario i.e. Phase 6.

 Various plans have been formulated by the bank for the preservation of the environment with the help of formulating various policies but are not enough for moving forwards in the Dunphy phase. Therefore, it needs to make some changes in the policies for the development of the economy and protection of the environment for becoming a sustainable organization.    

The sustainability and accountability framework of an enterprise includes its performance in five key dimensions namely economic, governance, social, ethical and environmental.

The importance of indicators lies in the fact that it allows an enterprise to resolve the issues faced by it (Lataweic & Agol, 2015). Moreover, it assists an organization in knowing about the efficiency of its system along with providing the necessary guidance to overcome the existing issues. These indicators stop an organization from deviating from its path and allow focusing on more important issues.

For Bank Australia, social, economic and environmental performance indicators are important which are presented in the table below.

Social	Economic	Environmental
1.Employment 2.Human Rights 3.Education 4.Health and Safety	1.Benefit to Economy 2.Customer Satisfaction 3.Turnover 4.Cost Savings	1.Natural environment and resources 2.Waste Management 3.Energy and material use 4.Environmental management

Social impact implies the impact of the banking industry in the well-being of employees and customers and the development of community as a whole. There is a requirement for keeping the jobs in Australia instead of transferring them to the people migrated from the rest of the world. Equality of human rights must be offered to the employees as well as the customers for the development of the economy. The enhancement of the technological and scientific education of the future generation is important for the social development of Australia. The health and safety of the employees and the customers need to be monitored for the sustainability of bank.

The sustainability of the bank is affected by the benefits provided by the bank to the economy. The satisfaction of the customers should be taken care of for serving them in the future by providing outstanding services. The loyalty of the customers will assist in the sustainability of the bank. High turnover of the bank will reflect its position in terms of high deposits and advances thereby helping in its sustainability. Moreover, the expenses and costs associated with the operations of the bank should be managed appropriately in order to survive in the long run.

Social Indicators

The sustainability of a bank is affected by contributions made by it for the protection of the environment. Natural environment and resources must be preserved by providing facilities like mobile apps and online banking so that customers do not require driving to the branches thereby reducing environmental pollution. Moreover, the use of paper should be reduced by promoting online banking and the waste papers must be management by recycling.

The sustainability dimensions namely socio- cultural, economic and environmental dimensions captures the three areas of triple bottom line i.e. people, planet and profit.

The socio- cultural dimension of sustainability can be defined as an organization’s ability to guarantee welfare in terms of health, security and education which is distributed equally among social classes and gender. The health and safety of the employees along with their satisfaction, impact on the consumers are the key factors that come under the social dimension of sustainability (Vallance, Perkins & Dixon, 2011).

• They create employment in the regional communities by making a commitment for not offshoring the jobs.
• They invest in a wide range of initiatives that address various social issues important to the customers with the help of Bank Australia Impact Fund.
• It has also contributed towards the closing of gaps between the First Peoples and other Australians by signing a Reconciliation Acton Plan.

The economic dimension focuses on the improvement of economic status of stakeholders instead of focusing on the financial status of the company. Since Bank Australia works as a customer owned bank, its major stakeholder is its customers. Bank Australia works for creating prosperity for their customers along with investing the money for the mutual prosperity in a responsible manner by undertaking following activities.

• It returns the profits to their customers whom are considered the owners of the bank in the form of fair fees and better rates.
• Financial inclusion of those people is promoted who may be incapable of accessing the mainstream banking services.
• Investing the money of the customers in a responsible manner and for other purposes that are not considered unethical, irresponsible or detrimental to the environment or the community.

The environmental dimension of sustainability takes into account the objective of meeting the needs of the present generation in a way such that the future generation does not have to make any compromises for meeting their needs. This dimension takes into consideration the impact of the activities undertaken by an organization on the environment (Holden, Linnerud & Banister, 2017).

Bank Australia takes the initiative for protecting the environment and creating a healthier planet by adopting a progressive approach in building a fair, strong nation and a healthy planet. They have adopted following steps for achieving their objectives.

• Investment in the world’s first environmental project for a bank namely Bank Australia Conservation Reserve, which is collectively owned by their customers.
• Promising for never providing any loans to the fossil fuel industry including projects related to coal and coal seam gas.
• Establishing commitment to an action on climate change by becoming the world’s first bank in signing the seven climate commitments under the climate leadership platform namely We Mean Business.

Socio- cultural dimension is selected as the specific sustainability area for Bank Australia since it is a customer- owned bank. It takes the responsibility to work for their customers by caring for them, creating mutual prosperity and providing them competitive prices and outstanding service (Dempsey, Bramley, Power & Brown, 2011).

Bank Australia works for the purpose of creating positive social outcomes for the people including their staff, customers and the community in which they operate. Therefore, a list of indicators is developed for Bank Australia for the purpose of monitoring the socio- cultural dimension of sustainability -

• Employment
• Human Rights
• Education
• Health and Safety

Economic Indicators

Employment- Employment can be defined as a contract between two parties which creates a relationship between them where the work performed by the employee is paid for by the organization (Peters, 2015). One of the central problems in Australia is the migration of people from other countries with the view to get a job. The indicators for monitoring employment by Bank Australia are job structure and unemployment.

For the purpose of measuring this indicator, Bank Australia is strongly committed to being an inclusive employer for keeping employment in Australia. It will be monitored by measuring the unemployment rates along with considering the job structure of the region.

The challenges faced by Bank Australia include high degree of migration along with various social problems which have a great impact on the future growth opportunities (Holt & Allen, 2015).

Human Rights- Human rights are the rights that are provided to all the human beings irrespective of color, national origin, religion, sexual orientation, socioeconomic stratum, language, etc. (Donnelly & Whelan, 2017).  The measurement of diversity is facilitated by openly supporting marriage equality i.e. they support equal rights and opportunities for all the people in their lives.

The challenges include the facing of waging humiliating battles from the other employees in the organization and people of the community (The New York Times, 2015). In other words, such customers and employees resist in coming forward, therefore taking measures for the improvement becomes a difficult task.

Education- Education can be defined as the process of acquiring general knowledge along with the development of powers that support judgement and reasoning for the purpose of preparing a person for a mature life. It will be measured by Bank Australia by monitoring the research and development along with the monitoring of the levels of education. Bank Australia also supports CSIRO Science Pathways for Indigenous Communities program. The challenges faced include the resistance and lack of interest of the students for learning science.

Health and safety- Health and safety and be defined as the well-being in mental, physical and social terms and being safe from the dangers, injury and risk (Straker, Dunstan, Gilson & Healy, 2016). It can be measured with the help of monitoring the life expectancy and premature deaths (Tetrick & Peiro, 2016). For this purpose, Bank Australia has developed a Reconciliation Action Plan which significantly outlines the tangible actions for closing the gaps in life expectancy of Australia’s First Peoples and other Australians.

Environmental Indicators

The challenges faced include the less access to essential health services to the Aboriginal peoples and Torres Strait Islanders (Australian Human Rights Commission, 2018). Meeting of the target relating to life expectancy still remains challenging due to slow progress rates.

Monitoring systems are used for the purpose of monitoring and measuring the sustainability of a business on periodic basis in order to bring more effectiveness in the business operation of the business. Risks associated with the businesses are reduced to a great extent when proper monitoring systems are installed as it allows proper decision making at the right time (Asian Development Bank, 2014). A good monitoring system assists a company in the process of improving their growth along with providing a variety of measures for the purpose of reduction in the losses occurred. It must be updated regularly for providing a rationale regarding the future performance targets (M & E Studies, 2017).

Monitoring systems will assist in reporting of the accomplishment of targets and procedures. In the banking business, it must be prepared on weekly basis and then on monthly basis as the operations of the bank are very crucial. It will also help in analyzing the position of the bank in the market. However, decision making will be done on the basis of annual reports which will show whether targets are achieved or not.

The time required for Bank Australia for reaching Dunphy phase 5 cannot be predicted since only three dimensions of EGSEE are addressed here. However, it can transform efficiently by taking all the aspects of EGSEE into equal consideration. The benefits of sustainability will be highlighted in the long run.

Sustainability Implementation with the A-B-C-D Process:

Awareness and Defining Changes	Baseline Current State	Creative Solutions	Decide on Priorities
Bank Australia is not able to spread awareness regarding its existence and is therefore unstable.	It is significantly improving by providing personal service and competitive prices and is at progressive state.	Need to proceed slowly with creative ideas.	Identification of problem areas, creation of strategies, solution and process of implementation with continuous monitoring and reporting systems.

Conclusion

This report assists in concluding that the consideration of sustainability is important in the operations of a business. The three important dimensions of sustainability namely socio- cultural, economic and environmental dimension have been discussed in this report along with their application in the operations of Bank Australia. Moreover, the report focuses on the monitoring systems of sustainability with the help of effective indicators. Various indicators have also been developed in this report which can assist in the monitoring of socio- cultural dimension of sustainability with the help of effective measures.

References

Asian Development Bank. (2014). Developing Indicators and Monitoring Systems for Environmentally Livable Cities in the People's Republic of China. Asian Development Bank.

Australian Human Rights Commission. (2018). Close The Gap Community Guide. Retrieved January 22, 2018 from https://www.humanrights.gov.au/publications/close-gap-community-guide

Bank Australia. (2018). Who are you?. Retrieved January 20, 2018 from https://bankaust.com.au/support/faqs/about-us/who-are-we/

Dempsey, N., Bramley, G., Power, S., & Brown, C. (2011). The social dimension of sustainable development: Defining urban social sustainability. Sustainable development, 19(5), 289-300.

Donnelly, J., & Whelan, D. J. (2017). International human rights. Hachette UK.

Holden, E., Linnerud, K., & Banister, D. (2017). The imperatives of sustainable development. Sustainable Development, 25(3), 213-226.

Holt, A. S. J., & Allen, J. (2015). Principles of health and safety at work. Routledge.

Lataweic, A. & Agol, D. (2015). Sustainability Indicators in Practice. Walter de Gruyter GmbH & Co KG.

M & E Studies. (2017). Characteristics of a Good Monitoring & Evaluation Syste. Retrieved January 20, 2018 from https://www.mnestudies.com/monitoring/characteristics-good-monitoring-evaluation-system

Peters, R. S. (2015). Ethics and Education (Routledge Revivals). Routledge.

Straker, L., Dunstan, D., Gilson, N., & Healy, G. (2016). Sedentary work. Evidence on an emergent work health and safety issue.). Sedentary work. Evidence on an emergent work health and safety issue.

Tetrick, L. E., & Peiro, J. M. (2016). Health and safety: Prevention and promotion.

The New York Times. (2015). The Challenges That Remain After Marriage Equality. Retrieved January 22, 2018 from https://www.nytimes.com/2015/07/29/opinion/the-challenges-that-remain-after-marriage-equality.html

Vallance, S., Perkins, H. C., & Dixon, J. E. (2011). What is social sustainability? A clarification of concepts. Geoforum, 42(3), 342-34