Australian Wheat Board
Australian Wheat Board (AWB) Limited is a grain marketing organization based in Australia. It had been a government body since its commencement in 1937 until 1 July 1999 when it was handed over to the Australian wheat growers. AWB is organized into three divisions: rural services, financial services, and the commodity management unit. In this arrangement, the rural services division supplies the products to the retail stores that distribute the commodities to the rural areas of Australia while the commodity management provides the products to the global customers in more than 50 countries. Even though this organization has got various ethical standards to be followed by its employees, it has also faced challenges from the corruption scandals which occurred in the mid 2000s (Botterill 41).
The specific fraud issue that affected the organization is corruption scandals which took place in 2005. It took the form of bribery and kickbacks which were paid to Saddam Hussein, the former Iraqi leader. The fraud occurred in 2005 when the company was alleged to ignore the United Nations sanctions and the Australian law which forbids such actions. This company’s action was meant to help to retain the commodity exchange business between Iraq and the company. The illegal action resulted into a 230 million dollars compensation for the damages caused to the North American farmers when they lost their market due to corruption. The organization also lost its monopoly status again the management was changed. At this particular time, Andrew Lindberg was the managing director and was fined 100000 U.S dollars. while Paul Ingleby was the chief financial officer, who later paid 10000 U.S dollars as fine.
Another fraud the company faced was that of obtaining financial advantage through deception and giving of misleading information to the auditors in the year 2000 by the then AWB chairman, Clinton Condon. The fraud, which also made the organization to realize a loss of 12.5 million, started when two employees, Mark Timleris and Claire Horsman falsified some contracts and fabricated reports to the banks. They also engaged the organization in speculative foreign exchange trades so as to hide the company losses for several years before they told Clinton in the year 2000. However, Clinton went ahead and signed the audited financial statements in 2001 despite him being aware that they were faulty. Both the two employees and Clinton were therefore put into jail. In all these scandals, it is evident that the ethical standards breached are the requirement to avoid any financial deception and the need to report any to report any form of ethics violation as was done by the two employees and Clinton. Also the managing director failed to honour the market guiding standards (Botterill 113).
Concerning the making of ethical decisions within the organization, the management of the company has come up with various ideas for realizing the best code of ethics whenever an ethical problem has been realized. Its first step is the identification of the problem. In this case, the management commits itself to establish the exact ethical problems which need to be tackled. Thereafter, it analyses the code of ethics relevant to that particular problem in order to find out whether there is any drawback in the standards (Botterill 458). The management then determines the nature and dimensions of the dilemma in order to find out the extent of damage caused by the subject problem. Various problem solving actions are then proposed by the management to exploit all the possibilities. Thereafter, the possible courses of actions are evaluated and the best one is selected to solve the ethical problem. Finally, the chosen course of action is tested, evaluated, and implemented when the organization is sure that it will give an ethical solution to the current ethical problem (Botterill 459).
The Australian Wheat Board operations are also guided by the various rules and regulations which are categorized into two components. These components are the business practices and the personal conduct of the staff. The staff members’ behaviors are guided by various rules which include the requirement to regularly read the codes of conduct so as to continually familiarize themselves with any change. The employees are also required to comply with the code of conduct and seek for clarification from the human resource department on the scope of such guiding principles. Employees are also given the responsibility to report any form of ethics violation by any party within the organization. They are also required to comply and support any investigation involving the breach of code and the company’s policies and procedures (Lindberg 3).
The organization’s code of conducts further states that the employees may also not accept incentives or inducements from organizations, since such incentives may be compromising to the employees’ work obligations. However, the company has also stated the circumstances under which an employee can accept such gifts. For instance, a gift or benefit can only be accepted when they value less than 300 dollars. But in cases where the amount is greater and its rejection may imply negatively to the company, they can be accepted after notifying the managing director. Emphasis is also put on ensuring that the employees’ loyalty to the other staff members and management does not compromise the appropriate standards of ethical behavior and courses of actions (Lindberg 5).
Lindberg, (10) further states that the management of the company is also required to protect the employees from any victimization for whistle blowing over misconducts by any member of the both the junior and senior staff. Additionally, it requires treating all the employees without any form of discrimination. Finally, the company’s employees should not take the advantage of private information, as it can negatively affect the organization.
On the other hand, business practices codes of conduct are the rules guiding the behavior of the people acting on behalf of the company. These practices include the avoidance of deception and unfair practices against other stakeholders. The employees should also practice honesty and good faith while dealing with other stakeholders. Employees are also required to respect their obligations in taking care of the AWB assets, resources, and confidential information (Lindberg 11).
Purchasing of contracts is also required to be conducted in ethical manner. It involves making arrangements in accordance to the AWB tender requirements which emphasizes fairness, equality, and the clear statement of the contract requirements while handling the potential contractors. Finally, all the employees are required to maintain the professional standards of dressing and general presentation (Lindberg 16).
As demonstrated in the Australian Wheat Board, it is evident that ethics should be observed in every organization for a smooth running and for a positive image.