subscribe to our newsletter sign up

Yuck: Aussies don’t rate banks

Unethical behaviour

Executive salaries and bribery are the most prominent examples of unethical behaviour in Australia’s finance sector, and the royal commission isn’t helping the perception, a new report has revealed.

“Australians expect high standards from their financial institutions, but our research suggests that these are far from being met,” the chief executive of the Governance Institute, Steven Burrell, said on Wednesday to mark the release of its latest ethics index.

“The index suggests numerous high profile scandals, and the alarming corporate breaches being revealed on a daily basis by the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, are undermining confidence in the sector,” Mr Burrell said.

The banking, finance and insurance sector saw the lowest score across all industries on the ethics index for the third year in a row. Industry super funds are still considered most ethical type of organisation, but also suffered a fall in esteem, while accountants had the highest ethical net score among occupations in the sector.

However, 42 per cent of respondents consider mortgage brokers to be either very, or somewhat, unethical. Funds managers aren’t far behind (37 per cent).

In terms of organisations, pay day lenders are considered the most unethical (68 per cent), with 50 per cent of respondents also considering life insurance companies somewhat or very unethical.

Retail banks didn’t fare so well either. They suffered a fall in net score of 26, with 46 per cent of Australians judging them to be unethical.

“The community’s faith in some of the country’s biggest corporations has been sorely tested, following a turbulent 12 months in Australia’s banking finance and insurance industry,” Mr Burrell said.

“Its net score has dropped dramatically from last year with a score of -15. It has never before scored this badly – 55 per cent of respondents consider the sector unethical and only 28 per cent view it as ethical,” he continued, suggesting the low ratings for life insurance companies and retail banks could be a by-product of the royal commission.

“If corporations like the banks and other financial institutions continue to be exposed for pursuing profit to the detriment of their customers, we can expect confidence in them to drop even further,”Mr Burrell concluded.

Yuck: Aussies don’t rate banks
Unethical behaviour
nestegg logo
subscribe to our newsletter sign up
Recommended by Spike Native Network
Anonymous - Wow, describes perfectly ISA funds!! How has quoted sources like ASIC & ACCC never twigged, or is there collusion?

Especially point 2 onwards - if.......
Graham Smith - This is the subject of my Doctoral Thesis........
Rethinkr - It's also disgraceful that - for those who continue to work - additional voluntary contributions to superannuation are apparently prohibited. This is.......
Marina - Despite never having a break from my career since university and, despite upgrading my skills, I was unable to get any job after trying for more than.......