Standard Chartered plc operates as one of the taking Bankss in the universe. The banking group, besides known as Stanchart in the banking industry, operates with over 500 offices in 50 states throughout the Asia Pacific part, the Middle East, South Asia, Africa, the United Kingdom, and North and South America. Its Consumer banking subdivision is responsible for 58 per centum of their operating net income in 2000. The bank provides clients with recognition personal loans, credit/ debit cards, mortgages, and investing services. Its Sweeping banking unit caters to corporate clients in the trade finance, hard currency direction, detention, loaning, debt capital markets, involvement rate direction, and foreign exchange. In the twelvemonth 2000, the bulk of SCB ‘s gross from its Hong Kong and Asia Pacific part operations, while the North and South America and the United Kingdom secured 14 per centum, Middle East accounted for 18 per centum, and Africa claimed 9 per centum of the grosss. The bank derives more than 90 % of its operating income and net incomes from Asia, Africa, and the Middle East. SCB has about 1750 subdivisions and mercantile establishments located in more than 70 states.

The London-headquartered Bank has operated for more than 150 old ages in some of the universe ‘s most dynamic markets, taking the manner in Asia, Africa, and the Middle East. Its income and net incomes have more than doubled over the last five old ages, chiefly as a consequence of organic growing, supplemented by acquisitions. The group employs 75,000 people, about half of whom are adult females. Its employees are of 115 nationalities, with 60 of these represented among senior direction.

Highlights on the ethical quandary of Standard Chartered Bank

Although Standard Chartered Bank is an international bank and states tend to swear it for its international criterions, but being such a widespread company they have their ethical unfavorable judgments. Some of the unethical quandary that the company has faced over the old ages are-

Credit card complaints- Recently SCB has been confronting extended differences in Asia peculiarly in India and Pakistan sing the selling of their recognition cards.

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Figure 1:1- Decrease of the usage of recognition cards The authorities ‘s trade proctors, the Monopolies and Restrictive Trade Practices Commission, started an probe of card-selling patterns by certain Bankss including Standard Chartered Bank, HSBC and the local Bankss ICICI and HDFC. The committee has the power to ticket companies and limit their concern traffics. All the Bankss involved say they have followed all appropriate trade patterns and are collaborating with the petitions for review. The Reserve Bank sent letters to all commercial Bankss warning about “ exorbitant ” involvement rates, inquiring them to do certain costs to the borrowers were justifiable. The ombudsman ‘s office at the bank said it received 3,700 consumer ailments about recognition card loaners within merely the first 5 months of 2006. Newspapers on a regular basis run articles stating consumers how to call off their cards. ( http: // )

Stock market dirt ( International Agenda ) – A study on India ‘s biggest fiscal dirt during 1991 & A ; 1992 accuses foreign Bankss of transacting dummy trades to cover up losingss or camouflage minutess by favorite Indian agents. The study from the Reserve Bank of India ( RBI ) exposes what it calls the link between Indian agents and two foreign Bankss, Standard Chartered and Australia and New Zealand Banking Group ‘s ANZ Grindlays Bank. The study accuses Standard Chartered of come ining into fabricated minutess to cover up an ever-increasing figure of unaccounted trades on its investing portfolio. The cardinal bank of India issued mulcts of approximately $ 42 million to 10 foreign Bankss, including Citibank, Bank of America, American Express Bank Ltd. and Standard Chartered Bank, with the accusal of engagement in India ‘s worst securities indignation. SCB violated its guidelines by financing certain stock market operations, every bit good as assisting out a fathered agent, Harshad Mehta, by seting through a figure of dummy minutess. ( Sanjoy Zakaria, 1994, New York Times )

Acquisitions and outsourcing threat- In Malaysia, Bank Negara Malaysia in the fiscal maestro program encouraged outsourcing of non-core maps by Financial Institutions. Ever since, Bankss have been researching outsourcing as a manner to apologize and streamline operation. While outsourcing is a manner frontward to cut down cost, manage work force dependences and to let fiscal establishments to concentrate on its nucleus concern of supplying services and fiscal merchandises, such outsourcing is done without anterior audience with workers ‘ representative viz. SBEU. Decrease of staffs non merely occurs to those straight affected by the outsourcing of the occupation maps, but besides other complementary staff countries. Example, outsourcing of Gross saless and Marketing occupation in Standard Chartered Bank has transferred occupations originally done by Particular Grade Clerical. Indirectly, this will cut down calling publicity chance. The bank has besides use rationalisation ( due to outsourcing ) as an alibi to shut subdivisions and scale down others. In the instance of Standard Chartered Bank, the bank has gone on shuting 15 subdivisions countrywide with two in Sarawak harmonizing to Law Kiat Min, General Secretary of Sarawak Bank Employees Union.

Evaluation of the Ethical Dilemmas Faced by Standard Chartered Bank

Credit card complaints- The consumer tribunal in India has been undertaking jobs sing unjust recognition card charges and improper agencies to retreat the hypocrite due sum, Credit Card Footings Prompt Indignation Arigit Sengupta, a hotel director in Bangalore, swears he is ne’er utilizing a recognition card once more. Skip to following paragraphAfter bear downing approximately 30,000 rupees ( $ 743 ) to his card and paying his minimal balance on clip, he wound up owing his bank more than three times that sum. Local and foreign Bankss are sharply fliping recognition card histories in India, where a aggressive in-between category with disposable income has created the perfect card client base. ( Refer to Appendix-2 ) Even though the house is keeping the contractual theory with a client during selling these recognition cards, which represents that houses have a duty to follow with the footings of the sale, inform the clients about the nature of the merchandise, avoid deceit of any sort, and non hale the client in any manner. But on the other manus SCB is overlooking the due attention theory which focuses on the comparative exposure of the client, who has less information and expertness than the house, and the ethical duty that places on the house. Customers must depend on the house supplying the merchandise or service to populate up to the claims about it and to exert due attention to avoid client hurt.

The consequence is loud and aggressive unfavorable judgment from card holders, consumer advocators and the authorities regulative organic structures. SCB is accused of imposing unjust fees and nuisance charges every bit good as supplying suffering client service. “ These Bankss are rip offing the populace, ” said C. V. Giddappa, general secretary of the Credit Card Holders ‘ Association of India, a countrywide consumer group. Mr. Giddappa ‘s organisation estimates that Indian consumers are paying 16.4 million rupees a twenty-four hours ( more than $ 406,000 ) in unfair charges, and is fomenting for a debt-free India by 2020.

Stock market dirt ( International Agenda ) – Sing the peculiar dirt in 1991 & A ; 1992 in India a spokesman for Standard Chartered said some of the study was deceptive, peculiarly the decision that senior directors were cognizant of the fraud. Barry Northrop, who heads a Standard Chartered squad seeking to retrieve the bank ‘s losingss in the dirt, said the fabricated trades were created without the cognition of senior direction and in rebelliousness of both internal and RBI guidelines. Persons involved had been dismissed and processs tightened. In footings of theories SCB has complied harmonizing to Milton Friedman ‘s theory ( 1970 ) sing corporate societal duty, which interprets that the lone legitimate intent of a company is to make wealth and prosecuting their concern efficaciously for the benefit of their clients, whilst supplying a profitable wages to their investors. Bing a foreign bank SCB acted upon their best involvement financially, harmonizing to Friedman it ‘s the function of the province to supply the legal model that regulated companies ‘ behavior in relation to the remainder of the community, the authorities or any appointive monitoring entity should hold foreseen such a dirt and prevented it from happening. But in the context of Kant ‘s theory, deontology or duty-based moralss that justice ‘s morality by analyzing the nature of actions and the will of factors instead than ends achieved in other words deontological theory focuses more on inputs instead than results. Therefore since this move of SCB was clearly unfavorable for the economic system of India, it worked as a bad repute for the bank every bit good as other foreign Bankss. ( Refer to Appendix-3 )

Acquisitions and outsourcing threat- The pattern of outsourcing is considered as a good option, since it provides guaranteed professional aid for concerns without the disbursals of keeping fulltime employees, but it besides poses as a menace for the domestic states work force. Outsourcing for endowment leads to miss of occupation security for the local employees. Standard Chartered bank and a few other international Bankss in Malaysia has been outsourcing extensively which has lead to an incommodiousness for the employees of the state. The proviso in the Collective Agreement merely requires the Bank to confer with the Union prior to outsourcing. Outsourcing has necessarily reduced head count of staff of fiscal establishments. Attempts by brotherhoods to negociate with the bank to guarantee that when staff moved over to the new entity ( outsourcing company ) , and retain their senior status, wage and benefits has non been successful. While it is non possible to extent exact figure of employees who lost their occupation due to outsourcing, it is estimated that approximately 30 % of employees are straight affected totaling about 1,000 staffs. This figure is expected to increase due to continued rationalisation and system technology. Outsourcing takes two signifiers, viz. , transportation of occupation map to head office prior to outsourcing in the instance of Bumiputra Commerce Bank or

direct outsourcing which happened in Standard Chartered Bank. Based on such results and sing SCB ‘s current position as one of the best transnational fiscal establishments, Carroll ‘s ( 1979 ) four measure theoretical account on CSR can be used to emphasize the deepness of the responsibility an organisation needs to follow. The first two stairss of the theoretical account remain apparent, but the last two stairss addresses peculiarly to the quandary SCB is confronting. Since Carroll believes that because a company can impact the involvements and even lives of people, it should be accountable/responsible, to social involvements over those of the proprietors and beyond the specific bounds of the jurisprudence.

Best Ethical Values and Practices of Standard Chartered Bank

Even though Standard Chartered Bank has had a repute of utilizing unethical agencies to make a much good terminal in footings of the company ‘s market enlargement. Although the British Empire is n’t every bit planetary as it used to be, that has n’t stopped Standard Chartered.

Sustainability is built-in to Standard Chartered. Worldwide and in Malaysia, the bank title-holders dedicated causes, e.g. the environment. The organisation believes that everyone can do a difference, and through little stairss, the corporate attempt contributes to the overall impact as the community unites to continue the environment for future coevalss. The organisation is determined of acquiring it right internally, before traveling out to the populace. The scheme of implanting the environment consciousness among the staff was a cardinal focal point for SCB in turning green persons. As such, their green docket is woven into every degree of the bank ‘s concatenation of operations.

Environmental and Social Awareness- Over the last two old ages, Standard Chartered has run multiple activities and plans concentrating on cut downing wastage, self-awareness and take downing C footmark under its umbrella subject. From cutting back on air travel to implementing shared-printer installation between sections, the consequences have been really spirit uping. The bank has experienced every bit much as 50 % decrease in air travel, 20 % in paper ingestion, 10 % in electricity use and 50 % decrease in air travel, and the debut of e-statements with clients.

Higher marks are set for 2011. The bank is already utilizing recycled paper for their concern cards.

Their other plans, “ Seeing is Believing ” a plan for forestalling curable sightlessness, Populating with HIV/AIDS, Financial Literacy Programme, are being tackled on land with face-to-face interaction given there ‘s a higher degree of societal sensitiveness sing these causes. All the undermentioned activities performed by SCB directs to the theory of “ Consequentialism ” ; consequentialist moralss bases decision-making on the best result for the largest group that besides consequences in the least injury. It is a signifier of useful moralss, which focuses on consequences instead than deep sitting moral jussive moods. The public-service corporation rule expects the decision-maker to weigh the possible effects of his/her actions to choose options that offer the best consequences for the overall society. This has lead SCB in achieving the rubric of one of the universe ‘s most ethical companies in four back-to-back old ages till 2010 all in acknowledgment of its on-going committedness to construct a sustainable concern for the benefit of clients, clients and the communities in which it operates. ( Refer to Appendix-4 )

Workforce Diversity- With more and more organisations traveling planetary, diverseness at work is progressively going an built-in portion of every organisation. Diversity refers to any sensed difference among people like age, race, faith, profession, sexual orientation, geographic beginning and life style. SCB has started their journey of diverseness and inclusion in India from 2006 with formation of the D & A ; I Council. SCB ab initio started by concentrating on three facets of diverseness, gender, disablement and nationality. Some of the cardinal concerns were the substructure of the on the job adult females, work-life balance, and barriers to growing. A series of focussed group treatments were conducted to understand and turn to these concerns to assist place Standard Chartered as the employer of adult females ‘s pick, ” states Rajashree Nambiar, GM – distribution and state title-holder, diverseness and inclusion, Standard Chartered Bank. From an ethical position the bank has been exerting virtuousness moralss which focuses on the person ‘s moral stature instead than the morality of the act itself. A moral histrion will establish his or her determinations on values instead than effects or responsibility. However, the person is portion of a community so the virtuousnesss valued by the community affect the person ‘s determination devising and thought procedure. A civilization ‘s values are incorporated into the person ‘s ethical though procedure. As a planetary bank, the assortment of markets they do concern in makes them diverse inherently.

In footings of gender diverseness ; adult females make up to 46A per cent of their entire work force and the figure of adult females in senior direction functions has besides increased. To increase female representation amongst senior direction they focused on making a grapevine of high-voltage female employees at in-between direction. In 2008, they developed a mentoring programme for their in-between direction endowment, with a specific focal point on adult females. The Bank actively supports International Women ‘s Day. Across their markets, and form a assortment of activities to acknowledge the accomplishments of adult females and highlight function theoretical accounts.

In 2008, SCB renewed focal point on pulling and back uping possible employees with disablements. Over the last 12 months, the Group trained and hired a figure of unsighted employees in Pakistan, employed their first visually challenged employee in Indonesia and Sri Lanka. SCB besides launched enterprises to back up employees with household duties, and new pregnancy and paternity leave policies were rolled out in Bangladesh, Lebanon, US and Australia in 2008.


Harmonizing to the logical thinking ‘s mentioned above it is clear that SCB ab initio made a batch of incorrect moves which was largely in their ain involvement, but bit by bit when they started being internationally recognized they have tried well to better their ethical ways as a corporation. They non merely provided international occupation chances in the economic systems they settled in, they besides came up with assorted societal consciousness activities e.g. fund-raising, and metropolis beautification plans in the states they are runing. Since they are a service based organisation their lone manner of pass oning to their clients should be through good will edifice and crystalline publication of their purposes and actions. On the other manus the authoritiess of the states where MNC ‘s like SCB operate should delegate more efficient and dependable monitoring organic structures for convenience.


Text Books/Articles-

Fisher, C & A ; Lovell, A, ‘Business Ethical motives and Valuess: Individual, Corporate and International Perspectives, 3rd Edition, Pearson Education, 2009

Crane, A & A ; Matten, D, ‘Managing Corporate Citizenship and Sustainability in the Age of Globalization, 2nd Edition Oxford University Press, 2007

Laurie J. Mullins, “ Management and Organisation behaviour, 8th Edition, FT Prentice Hall, 2007

Jacques P. Thiroux, Keith W. Krasemann, Ethical motives: Theory and Practice, 10th Edition, Pearson Education 2009

De Geaorge, Richard T. , Business Ethics, 7th Edition, Pearson Education 2010

Lawrence, P.R. and Lorsch, J.W. , Organisation and Environment, Irwin, 1969

Press statement April 2002 to Standard Chartered Bank on Closure and retrenchment of subdivisions -pages 7-9



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