Once upon a time…yes I am using a fairytale opening, because big business and morals in this country has now become a fairytale concept.
With the Royal Commission into Banks, who would be naive enough to think that all the other big publicly listed businesses actually do the right thing?
Why would they?
Their advertising says that you, the customer, are the most important thing to them when in fact it is hitting targets to gain bonuses. They couldn’t care less how they achieve their bonuses just as long as they receive them.
When was the last time you heard of a major Australian public company contributing to a crowdfunding campaign for someone in desperate need? I cannot remember one.
Small businesses have, however, and enjoy a far better image as a result.
The four major banks should have an ‘Humanitarian Budget’ which is allocated to the worthiest causes as judged by senior, or even middle management (remember them?). They can, and should, by any moral or ethical argument put some of the Billions of dollars in profit they make each year towards dozens, perhaps hundreds, of worthy causes. Their bottom line would barely be affected.
The one stupid, contrary argument (and unfortunately it is law) is that as publicly listed companies they must put shareholders interests first. In other words they must maximise shareholders’ dividend payments.
As mentioned they could easily give away $10M each and split it up into hundreds of worthy causes. However their shareholders would rightly ask “Hey, by law you have to put us first and by giving that money away I got $10 less in dividend income!”
With the law on their side unfortunately it is a circular argument, a Catch 22.
As long as that law remains as it stands, profits will always be put before helping people where public companies are concerned. Perhaps a ‘tweaking’ of the law is required?
Many large private companies (but still too few) are well known for their generosity. I argue it is because they decide what to spend their profits on, not a horde of needy shareholders.
At this stage I must put my own hand up, and reveal that I have owned shares and as a shareholder I lived for those dividends. Yes, I am two faced but at least I admit it and am ready to discuss badly needed change.
The big four banks might point to a number of charitable donations, but they seem to only contribute if they can place a huge logo on it, in order to achieve a return on investment for their marketing dollars. Yes, they call helping people in need “Marketing”.
Westpac used to have a lovely rescue helicopter flying around but only because it was saturated with their logo. Then they did some analysis and ROI (return on investment) calculations and ceased funding this rescue helicopter. Not because they couldn’t afford it, but because they need to put shareholders first followed closely by their bonuses (or is it the other way around?).
Putting bonuses ahead of helping people is disgusting and definitely unAustralian. Which is ironic because had they helped more families they would have received more favourable media coverage and may not be facing a damaging Royal Commission right now. It would definitely would change our perception of them.
But there is one final problem, and this is the biggest and by far the most difficult to understand. Almost everyone hates the big four banks, and will complain about them ad nauseum but they will not close their accounts and take their business elsewhere! The big four easily have 85% of the total market, so there is no incentive on them, at all, to change their ways. In fact it encourages them to behave badly because their customers do not leave them.
So, in the end, it is your own apathy and unwillingness to follow through on your complaints that makes them so comfortable. It also creates the perfect environment for corruption, because they know that no matter what they do their customers, by and large, will stay with them. So up go fees, down goes quality of service and contributing to the community.
Well done Australians, you reep what you sow.
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