Ethical Investment Report on Westpac

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Ethical investment report on Westpac Group
Report written by Ta Nhat Linh (Danielle)

Student’s number: 21833
Course: BAE – Class: 5
Teacher’s name: Mary Cayley, Paul Roxanas

Table of contents

Executive summary…………………………………………………………………..3 Introduction……………………………………………………………………………5
Background information on ethical investments………………………….........5 1.1. What investors consider when investing ethically?..............................5 1.2. Whether socially responsible investments are profitable or not?.......6

Evaluation of Westpac in terms of ethical investing…………………………...8 2.1. Ethical corporate behavior…………………………………………………..8 2.2. Respect for the rights of their employees………………………………..9 Evaluation of Westpac in terms of profitability………………………………….9 Recommendation…………………………………………………………………….10

References…………………………………………………………………………….11

Executive summary

The aim of this report is to help Mr. Tony Pham invest ethically in Westpac. It provides background to ethical investing and examines Westpac Banking Group in terms of its ethical and financial performance. This report surveys background knowledge about ethical investments and the assessment of profitability of this compared to conventional ones. Moreover, this also examines Westpac in terms of its ethical and financial performance and suggests some recommendation about whether the client should invest in Westpac or not.

The results of the research indicate that ethical investors often consider three main issues for their ethical investments: economic, social and environmental issues. Whether investing ethically is profitable or not is critical, but it may have a negative impact on community, society and the organization in the long-term. Furthermore, Westpac has good corporate social responsibility, such as: good ethical corporate behavior which makes Westpac be one of good choices for a wide range of investors all over the world and respect for the rights of their employees which is demonstrated by generating an inspired working environment. In respect of financial performance, Westpac still keep its position as one of the biggest bank of Australia with the increase in net profit after tax of 84% and in the dividend per share of 20% in 2010 compared to 2009. This report recommends that Mr. Tony Pham should consider ethical investment in Westpac due to strong indicators, such as: sustainable policies with good corporate social responsibility and its strong financial potential.

Introduction

This report is written for Mr. Tony Pham – a client who has been considered a great deal of corporate social responsibility and ethical investments. The purpose of this report is to help him make a decision on investing in Westpac Banking Group. Westpac has considered as the first and oldest bank in Australia, founded in 1817 and formerly known as the Bank of New South Wales. By 31 March 2010, Westpac has about 37,000 staff members and approximately 550,000 shareholders and around 10 millions customers all over the world now (The Westpac Group 2010). After providing some background information on investing ethically, the report will inspect Westpac regarding its ethical investing, such as its environmental concerns and respect for human rights, and financial aspects, such as its profitability. Finally, the report will make a recommendation as to whether the client should invest in the organization as an ethical investor.

Background information on ethical investments

1.1. What investors consider when investing ethically?

There are some issues considered when investing in an entity ethically, usually known as ‘triple bottom line’ or ‘corporate social responsible’ of the entity, which includes economic, social and environmental issues. In other words, this term refers to the companies which know to link its ethical values, transparency and employment relation in accordance with legal requirements and respect for the...
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