Principles of Corporate Social Responsibility for Insurance

Question: Discuss about thePrinciples of Corporate Social Responsibility for Comminsure Insurance. Answer: Common wealth bank of Australia V/S the Corporate Social Responsibilities The case study is about the well known bank of Australia which deals in services like life insurance and other insurance services. However there was an ethical issue which was noticed in one of its work or transaction which the company has committed with one of its consumer (Matten and Moon 2014). Some ethical issues were violated in this case and the bank was found guilty on certain basis after the violation of the rules and regulation that they had promised to provide to their customer. The case studies dictated the whole scenario that happened and it related to some special breach of the contract and the corporate social responsibility principles. The allegation of the illegal activity that the bank was accused of was, the violation of the contact which was a policy under the banks regular business, which was named as the Comminsure Insurance policy this policy insured the life on the policy taker and provide with the amount of payment at the time when the policy holder was suffering from terminal illness or a illness which may cause death of the insured at the end of 12 months or so (Dahlsrud 2018). The bank had a good reputation in the market and the CEO of the bank continues to talk about ethics related to the service provided to the policy holder. The principles that were violated were according to the principals of corporate social responsibility ethics; the main principal of corporate social responsibility is the sustainability in terms of resources, Accountability on the basis of all details that are required for the purpose of betterment of the society and finally Transparency which is required for the understanding of all the stakeholders of the corporation and providing transparent information (Sathye 2014). In this case the company does not precede relevant work which is regarding the first principal of CSR that is sustainability, however the other two ethical principle of CSR has been violated, namely, accountability and transparency (Lindgreen and Swaen 2013). The bank has been practicing unethical ways of earning profit not just for the first time but for several times in the market. It has already done certain unethical works while providing insurance policy to their customers, when the customers claim the amount of money at that time the bank started using certain unfair practices to avoid repayment like: No proper medical records were of the client was kept, so that the actual medical condition of the client cannot be detected in the future after the client has already bought the claim. They deleted medical records whenever the clients claimed the insurance policy as per the terms and condition. They create undue pressure on the doctors of the respective clients to change their opinion as per the profitability of the bank. They manipulate the medical report in such a way that it becomes difficult to show the actual condition of the client, and the client is unable to further claim the insurance facility. They rejected heart attack cases on the basis of their own scale of severity which was unethical so as to avoid repayment of the dues that were claimed by the client. Subsequently, it is seen that the principle of CSR is violated mainly the principle of accountability and the principle of transparency. This proves the bank guilty of the malpractices and the involvement in the scams that was convicted on them by certain clients in the year 2014 (Garriga and Mel 2014). Relevance of Sustainability and social responsibility of the CWB After analyzing the scam that happened in Australia which was committed by the Common wealth bank in Australia, it is seen that the organization has breached the principle of sustainability (Guthrie and Petty 2012). Sustainability is one of the principles of corporate social responsibility this involves seeing an organization as a part of the economic and social system. It is generally assumed that a corporate has certain duties that they need to fulfill as mentioned in the corporate socialresponsibility. The bank does unethical works that has a harassing effect on its customer, along with that they were not bothered about the consequences that may happen to their clients as well as their organization in the future. The sustainability of use of human resources is being disturbed by the action of the bank (Hemingway and Maclagan 2014). The miss uses of resources to earn profit at a high rate in against the rule of sustain ability and in future this may affect the bank's business trans action. The activities of the bank that proves the bank to be guilty of not following the principles of sustainability are: Use of the system of bribing the medical institution and influencing them to change their medical reports that they have made on behalf of the customers of the health insurance policy (Carroll 2016). Secondly, Unnecessary use of resources to manipulate the work of media so that they become incapable to influence the public against the common wealth bank. As per the media report few clients of the company that were affected by the un- ethical practice of the Common Wealth bank are namely: James Kessel: Hear Attack case Nicolas Bishop: Terminal lungs infection Evan Pashalis: Leukemia Helen Polydropolos: Multiple sclerosis Matthew Attwater: Major Depressive Disorder The above people are the customer of the Comminsure Insurance policy and their claims were rejected under certain un ethical grounds to avoided huge repayments by the common wealth bank, this proved the bank to be guilty of using such means in the regular business activity which is against the Corporate Social Responsibility social principles (Garriga and Mel 2014). The bank is affecting the social structure by the use of such practices of misinterpreting, creating undue influence, manipulating the evidences and other health reports and also not paying the ethical amount of the claim that a customer require or is eligible as per the prewritten terms and conditions that were written in the insurance policy that the customer availed. The principle Breached by CBA Mainly there are 3 main principles of the Corporate Social responsibility: Sustainability Accountability Transparency The CBA breached all the three principles neither there was sustainability in their work as they were not bothered to about the outcomes that may happen in the future due to the use of the resources for profitability in ethical grounds nor did they followed the other two rules of corporate social responsibility (Tai and Chuang 2014). The companies used the means of bribing influencing and so onjust with the motive of not paying the amount that the customerof their insurance policy is eligible for. Secondly, the principle of accountability was also hampered as the companywho is always accountable for its deeds to its shareholders or stakeholder of the respective company (Sathye 2014). In this case there was manipulation of information, misinterpretation as well as undue influence which violated the principle of accountability of the firm. Thirdly the principal of transparency was violated the most as the company did not show their true documentation and the processing of the insurance claim which was a deed violating the transparency principle of the corporate social responsibility. Ethical Violation and their Theories as per CSR There are major theories regarding the ethical issues of corporate social responsibility. In the case that is being analyzed the ethical theory are being violated the most vital of them are: Utilitarianism means that doing as much good of the customer or the client to whom the service is being provided or preventing any negative effect on the customer. However in the above discussed case the Common wealth bank has violated the rules of Utilitarianism. The bank cheated on the customers and avoided paying the amount that the customer is eligible to get. This deliberated to the bad effect on the customer and also deprived the customer from getting what they should get. Ethics of Rights means the ethical rights of all humans or the human rights are to be kept in mind while working with consumers and clients. The same things have been violated in the above case study. The human rights are also hampered of the above mentioned clients of the common wealth bank. Freedom of speech; Freedom from torture; Right to fair trail, all of these right of humanity were violated by the common wealth bank when the customers asked for the claimed amount which they deserved. Contractualism is also violated by the common wealth bank in this case. This ethics of corporate social responsibility says that the two parties to a contract must fulfill their terms and conditions and the agreement made as per the promise that they made before and provide what each other owe. The common wealth bank violated the above principle and did not act according to the contact that they promised to provide to its customer as per the terms of the insurance claim. References Carroll, A.B., 2016. Corporate social responsibility: Evolution of a definitional construct.Business society,38(3), pp.268-295. Dahlsrud, A., 2018. How corporate social responsibility is defined: an analysis of 37 definitions.Corporate social responsibility and environmental management,15(1), pp.1-13. 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