Saying the Right Thing Isn’t the Same as Doing it: The Performance Paradox

by Bonnie Zheng

In the contemporary corporate landscape, ethics has become inseparable from organisational identity, functioning less as a guiding principle than as a constructed narrative of legitimacy. Firms increasingly align with global frameworks such as the United Nations Sustainable Development Goals (SDGs), projecting responsibility and accountability. While this suggests a shift in how businesses perceive their societal role, persistent public scepticism reveals a deeper issue grounded in disillusionment with ethics that lack operational coherence.

This tension raises an important question: if businesses are talking more about ethics, why don’t people feel it?

The answer lies not in a lack of intention, but in a gap between what companies say and what they do. Ethical priorities are embedded at the strategic level, reflected in ESG disclosures and governance frameworks. Yet operational decisions remain governed by financial imperatives, where cost efficiency and competitiveness ultimately sustain shareholder returns. In this context, ethics becomes conditional, readily subordinated when it conflicts with short-term performance.

The experience of Qantas Airways Limited illustrates this contradiction. The company has made clear commitments to sustainability, particularly in reducing emissions in line with SDG 13 (Climate Action), through targeting a 25% reduction in net Scope 1 and 2 emissions from 2019 levels by 2030. However, criticism surrounding its reliance on carbon offsetting, alongside concerns about customer service and workforce relations, suggests a broader pattern of ethical compartmentalisation, where corporate virtue is articulated but rarely enacted.

Ultimately, the issue is structural. Ethics remains peripheral rather than embedded within core performance systems. To address this, organisations must align incentives with ethical outcomes, embedding ESG metrics into executive remuneration, strengthening accountability mechanisms, and ensuring greater transparency through independent verification. Only then can ethics move beyond narrative and become a discipline that shapes everyday business decisions.

The Trust Gap: Woolworths seems to forget ethics at the check-out.

by Saketh Damera

The Governance Institute of Australia's 2025 Ethics Index records a -49 Ethics Expectation Deficit: Australians rate ethics at 92 in importance but only 43 in how they actually observe it in corporate behaviour. That gap reflects a structural problem: companies say one thing in sustainability reports and do another at the checkout.

Woolworths Group (ASX: WOW) illustrates this. Its Sustainability Plan 2025 says the company wants to “have a positive impact on our customers and communities” and claims alignment with the Sustainable Development Goals, but that alignment appears not to extend to SDG 2 (Zero Hunger). In September 2024, the ACCC commenced Federal Court proceedings alleging that across 266 products and over 20 months, Woolworths temporarily raised prices before advertising them as discounted under its “Prices Dropped” promotion. A consumer class action followed in November 2024, with a liability trial now scheduled for April 2026. These cases were filed just weeks after CEO Amanda Bardwell was confronted in a Wollongong store by a customer questioning supermarket pricing.

SDG 2 calls for universal access to safe, nutritious and affordable food; inflating prices and creating illusory discounts undermines the food security of the very communities Woolworths says it supports.

When pricing is developed in isolation from stated values or SDG commitments, those commitments provide no check on behaviour. Boards can narrow the ethics gap by embedding ethics checks so promotional decisions are reviewed against commitments before implementation; commissioning independent verification of whether operational practices align with SDGs; and tying executive remuneration to trust and ethics metrics, not financial performance alone.

Public trust recovers when commercial decisions match public values. For Woolworths, that alignment still looks like unfinished business.

Price Check on Australia's Corporate Ethics

by Austin Tran

Australian companies invest heavily in the language of ethics, with sustainability reports becoming as standard as the annual report itself. Yet public trust remains stubbornly mixed, and recent events suggest that the problem runs deeper than individual misconduct. This gap persists because companies have learned to perform ethics rather than practise it, and the systems meant to see through it are themselves compromised.

Behind the slogans ‘Caring for All Australians’ and ‘Better Together’, Woolworths and Coles position themselves as companies with a purpose beyond profit. Together, they command around 65% of the domestic market. However, their alleged conduct tells a completely different story. In September 2024, the ACCC launched Federal Court proceedings against both giants, alleging they inflated baseline prices before placing products on promotional programs, making the advertised discounts entirely illusory. If the allegations are upheld, this represents a direct assault on UN SDG 1 (‘No Poverty’), with both companies deliberately extracting more from consumers that are already buckling under record cost-of-living pressures. 

And yet the systems meant to catch this are in no better shape. Corporate accountability depends on independent assurance providers to confirm whether ethical claims reflect reality. Even in analogous contexts, verification has proven fallible: Deloitte recently submitted a report containing AI-generated hallucinations and fabricated legal citations. If the institutions paid to verify ethical claims cannot themselves be trusted, then no framework can close the gap between what companies say and what stakeholders actually experience.

Australian governance already has the frameworks. What remains unanswered is whether those responsible for upholding them have any reason to act on them. Both failures share a common root: executives are rewarded for the appearance of integrity, not its substance. Until remuneration is explicitly tied to ethical outcomes, no framework, however well-designed, will be able to override that calculus.

Compliance is Not Conscience: Lessons from Rio Tinto’s Ethical Failure

by Juliette Gao

While Rio Tinto publicly aligns its operations with SDG 16: Peace, Justice and Strong Institutions, the destruction of Juukan Gorge remains a stark reminder of the gap between corporate commitments and real-world outcomes. Despite holding legal permits, the decision to prioritize mineral extraction over irreplaceable cultural heritage exposed a fundamental flaw: the company’s internal governance prioritized regulatory compliance over ethical stewardship.

The root of this ‘ethical bankruptcy’ lies in prioritizing short-term production targets over meaningful stakeholder consultation. When board oversight is decoupled from social impact, companies inevitably lose their social license to operate.

To bridge this gap, boards must mandate an ‘Independent Social & Cultural Audit’ for all major projects, ensuring that community voices carry genuine weight in decision-making. Furthermore, linking executive variable compensation to ‘social impact targets’—rather than purely operational output—would bake integrity into the corporate DNA. Real-world ethics must be integrated into project design, not merely polished in annual sustainability reports.

Corporate sustainability is not a checkbox exercise; it is the courage to prioritize human heritage over mineral yield. True trust is forged in respectful partnership, not harvested through the exploitation of regulatory loopholes.

The Shadow Values Saga: Why Corporate Ethics Fail Under Pressure

by Victoria Marsh

Corporate Australia is well-versed in the language of ethics. Nowadays, adhering to ESG frameworks and aligning with the UN Sustainable Development Goals (SDGs) are essential indicators of what it means to be a “responsible” business. Yet public trust remains mixed. Corporate leaders face constantly scrutiny and rising ethical expectations while internally the focus shifts to delivering profits, satisfying shareholders and sustaining growth.  

‘Shadow Values’ emerge from this tension - unspoken priorities that ultimately shape decisions when ethical commitments and commercial realities collide. 

Few cases reveal this more clearly than Star Entertainment Group. In its 2020 sustainability and ethics report, Star aligned itself with SDG 16 (Peace, Justice and Strong Institutions), emphasising anti-corruption, transparency and accountable management. Yet investigations reported by the Sydney Morning Herald exposed serious anti-money laundering failures, with $900 million in illicit funds flowing through its casinos despite repeated warnings. This was not a lack of ethical awareness, but a reflection of shadow values overriding stated commitments.

Organisational environments can normalise ethically questionable decisions when they align with performance pressures. Over time, what appears unethical externally can become internally rational.

Addressing this gap requires a reconsideration of how incentives are structured. As long as ethical behaviour remains the more costly option, it is unlikely to ever prevail in practice. Boards have a critical role in shaping decision-making conditions – through linking renumeration to compliance outcomes, strengthening independent oversight or embedding ethics into everyday operations rather than reporting frameworks.

Ethical credibility is not simply a function of how extensively commitments are articulated, but of whether they can endure when placed under commercial pressure. If the underlying pressures that give rise to shadow values remain unchanged, ethical conduct risks will continue to be acknowledged in principle but negotiable in practice.

The High Cost of ASX Stewardship Failure

by Belindha Ardhani

If trust is the most valuable currency in capital markets, why did the ASX choose to pay for its technological failures with the systematic deception of the public? Known as the steward of Australia’s financial infrastructure, the ASX’s betrayal of this role was laid bare in the April 2026 ASIC Final Report. The findings exposed a critical say-do gap that represented a chasm between the board’s optimistic public promises and the internal decay of the CHESS replacement project.

This deception is a direct violation of SDG 16, which mandates the development of effective, accountable, and transparent institutions. While profit-seeking is standard, it becomes unethical for a monopoly like the ASX, which holds a unique responsibility to maintain the nation's financial plumbing. By prioritizing short-term dividends over infrastructure resilience, the ASX externalized its risks by pocketing immediate savings while forcing the entire Australian economy to bear the potential cost of a systemic collapse. 

The evidence is damning, with internal memos flagging the project as 'Red' even as public reports remained 'Green'. The subsequent AUD 250 million write-off served as a mathematical admission of this failure. This ethical collapse stemmed from a commercial conflict of interest, as institutional silence suppressed technical warnings to prioritize executive incentives over integrity.

To rectify this structural flaw, the ASX must adopt international benchmarks, such as establishing an independent regulator mirroring Singapore’s SGX RegCo to firewall regulation from profit, and treating infrastructure as a stable public utility similar to the Swiss SIX model. These reforms are essential to decouple market safety from shareholder pressure and ensure technical integrity. 

Ultimately, the ASX must act as a trusted guardian, not a profit-maximizing corporation. The board must now choose: conceal itself behind the say-do gap, or confront it through the transparency required to honour its social contract.

The Gap Between Sustainability Commitments and Reality at Qantas.

by Beatrice Vu

Many businesses make strong sustainability claims to build trust, but a gap often exists between what they say and what they truly do. Qantas Airways is an example.

They publicly commit to achieving net zero emissions by 2050 and highlight investments in sustainable aviation fuel (SAF), fleet efficiency and carbon offset programs, aligning these initiatives with the SDG 13. (Sustainability Report, 2025). However, aviation remains a sector where emissions are difficult to cut as it still heavily depends on fossil fuels in reality. SAF is still far from being available at scale and Qantas’ own climate disclosures show that most of the emissions reductions in the short term are expected to come from carbon offsetting rather than operational change (Qantas News Room, 2022). Critics argue that this approach can make progress look stronger than it actually is. In 2024, Climate Integrity lodged complaints with the ACCC, claiming that their fly carbon neutral and net zero statements may be misleading (ABC News, 2024). Qantas also reports substantial Scope 3 emissions, which exceed its direct emissions, but these indirect impacts are rarely highlighted in public sustainability messaging (Sustainability Report, 2025). This gap reflects a broader challenge, which sustainability goals often collide with commercial pressures in a competitive industry where rapid emissions reductions can increase costs.

To narrow this gap, boards can link ESG goals directly to executive pay and major investment decisions, so climate commitments actually influence how leaders are rewarded (Qantas News Room, 2022). Increasing transparency around Scope 3 emissions and having key sustainability claims independently checked would also help rebuild trust. Finally, instead of relying heavily on offsets, directing more funding toward technologies that genuinely cut emissions would show that sustainability is a commitment in the long term, not just only a marketing message.

BHP and the Governance Paradox of Climate Commitments and Scope 3 Emissions

By Danno Sano

Many Australian listed companies publicly promote ethical values, ESG commitments, and corporate purpose. Yet stakeholder trust remains uneven. The gap often arises not from insincerity, but from governance systems that structurally prioritise short-term financial performance over long-term sustainability outcomes, creating tension between stated values and operational reality. 

BHP illustrates this tension in relation to SDG 13 (Climate Action). The company has committed to achieving net zero operational emissions (Scope 1 and 2) by 2050 and highlights climate action within its sustainability disclosures. However, the majority of BHP’s total emissions stem from Scope 3, particularly from the downstream use of iron ore and metallurgical coal in global steel production. Although BHP invests in decarbonisation partnerships and low-emissions technologies, continued reliance on commodities that enable carbon-intensive industries exposes a structural contradiction. Climate ambition coexists with revenue models tied to emissions-heavy value chains. As a result, ethical commitments risk appearing aspirational rather than transformative.

The persistence of this gap reflects governance design. Executive remuneration and capital allocation decisions remain predominantly anchored in earnings growth, production targets, and return on investment. Even where sustainability metrics are incorporated, they may lack material weighting or enforcement mechanisms capable of influencing high-stakes strategic choices. Without structural alignment, ESG commitments function as disclosures rather than decision rules.

To close the gap, boards should embed measurable Scope 3 reduction trajectories within executive compensation frameworks, link capital expenditure approvals to climate scenario analysis, and require independent assurance of transition plans. Transparent disclosure of trade-offs between growth strategies and emissions pathways would further strengthen accountability. A board-level sustainability committee with authority over major investment decisions would institutionalise ethical oversight. 

Ethical leadership is not proven through public commitments, but through governance structures that align incentives with long-term societal and environmental impact.

 

Not Hypocrisy: Why the Ethical Gap Is a Feature, Not a Failure

 by Josh Fisher

In 2021, ANZ published a human rights commitment explicitly endorsing the principle of free, prior and informed consent for Indigenous communities. That same year, it participated in a $1.5 billion loan to Santos for the Barossa gas project in the Timor Sea, while a Federal Court case brought by Tiwi Islands Traditional Owners was actively underway alleging Santos had never properly consulted them at all.

This is not hypocrisy. It is something more instructive.

UN Sustainable Development Goal 10 calls for equal opportunity and reduced inequalities regardless of origin. The communities most exposed to the Barossa project’s risks - the Tiwi and Larrakia peoples, whose sea country, food sources and songlines sit in the project’s path - had no seat at the table where the capital decision was made. ANZ’s human rights policy acknowledged their rights in principle. Its credit committee proceeded regardless.

The gap is not between intention and execution. It is between two different legal systems. Under Section 181 of the Corporations Act, ANZ’s directors owe duties to shareholders. A commitment to free, prior and informed consent carries no equivalent legal weight. When the two conflict, the outcome is predictable: the enforceable obligation wins.

This is why governance reforms alone are insufficient. Australia’s 2024 mandatory climate disclosure laws have already broken with the orthodoxy that corporate law concerns only financial returns. The next step is already being proposed: RMIT legal scholars have called for human rights due diligence to be embedded directly in the Corporations Act, following France and Germany, imposing an enforceable duty on directors to identify and address human rights risks in their operations and supply chains.

Until that happens, the distance between what companies declare and what communities experience will not be a governance failure. It will be a feature.

The Promise and the Practice: Woolworths and the Ethics of SDG 12

by Shubham Bansal

Master of Commerce (Extension) student Shubham Bansal is the winner of the 2026 Natoli Student Ethics Competition for an postgraduate student.

Woolworths Group (ASX: WOW) built its public identity around UN SDG 12, responsible consumption and production. Its Sustainability Plan 2025 pledged to eliminate single-use plastics and achieve fully recyclable own-brand packaging, earning ESG recognition and projecting a company in step with community values.

Yet in 2024, the ACCC took Woolworths to court alleging it artificially inflated prices before applying "discounts", deceiving consumers mid-crisis. The Governance Institute's Ethics Index 2024 found Australians rated supermarket pricing as the most unethical business behaviour. A company earning sustainability plaudits while allegedly misleading its customers is not acting ethically, it is managing its reputation selectively.

SDG 12 is not only about packaging. It encompasses responsible business conduct and consumer rights to accurate information. Yet the UN SDG Progress Report 2024 confirms only 17% of SDG targets are on track globally, partly because corporate commitments routinely outpace conduct. Woolworths illustrates exactly this dynamic.

The gap is structurally incentivised. Sustainability pledges are voluntary, self-measured, and rewarded by markets before verification. Misconduct surfaces only after regulatory action, sometimes years later. The ASX Corporate Governance Principles call on boards to instil ethical conduct across all functions. In practice, pricing strategy and consumer communications must face the same scrutiny as environmental targets. Australia's mandatory sustainability reporting regime, effective from January 2025, shows regulators recognise that voluntary disclosure is insufficient. The ACCC's enforcement action against supermarket pricing signals the same reckoning is coming for consumer conduct.

Woolworths has the scale to lead. The question is whether its ethical commitments govern every business decision or only the pages of the annual report designed to impress.

Corporate Sustainability: Why Ethics Break Down in Practice

by Amy Koss

Bachelor of Commerce and Bachelor of Advanced Studies student Amy Koss is the winner of the 2026 Natoli Student Ethics Competition for an undergraduate student.

 

As a student studying sustainability, I find it telling that corporate ethics is so often met with one cynical response: greenwashing. Australian companies regularly promote ethical values, ESG commitments and corporate purpose, yet public trust remains mixed. Why?

The answer is not that companies lack ethical frameworks. It is that those frameworks often fail to surface in day-to-day commercial decisions, reducing sustainability to a communications exercise rather than a strategic priority.

Qantas provides a clear example. The company publicly promotes sustainability initiatives, including its “Fly Carbon Neutral” program and a pathway to net zero, aligning itself with United Nations Sustainable Development Goal 12 (Responsible Consumption and Production). However, these claims have been challenged by climate advocacy groups, who argue that such messaging risks underrepresenting the environmental impact of flying and relies heavily on carbon offsets rather than fundamental emissions reduction. This creates a disconnect between how sustainability is presented and the underlying environmental reality, weakening public trust in whether corporate climate commitments reflect genuine change or carefully managed branding.

This gap is not accidental. It reflects how organisations are actually run. Incentives remain heavily tied to financial outcomes, while ethical commitments are often measured through reporting rather than lived behaviour. Under pressure, decisions often prioritise short-term financial value over long-term business sustainability, particularly when environmental trade-offs are difficult to quantify.

Closing this gap requires boards and leaders to embed ethics into the mechanics of decision-making. This includes linking executive incentives to customer and stakeholder outcomes, requiring ethical impact to be internally and externally monitored alongside commercial trade-offs, and ensuring that sustainability claims are grounded in verifiable action rather than aspiration.

Until ethics is built into how decisions are made, not just how they are described, the gap between what companies say and what stakeholders experience will persist.

2026 Student Ethics Prize Details Announced

 

The Natoli Student Ethics Prize, supported by the Business Ethics Collaborative within the Beta Gamma Sigma Honour Society, invites students to reflect on contemporary ethical challenges in business and society. The competition showcases student perspectives on ethics, governance, and responsible business practice.

Further details are available on the Business Ethics Collaborative website. 

The Illusion of Ethical Progress: How Corporations Weaponize Ambiguity

by Kayra Soytemiz

The Australian public’s ethical neutrality toward business, revealed in the 2024 Ethics Index, is not indifference but principled disillusionment — a societal rejection of curated moral narratives that lack existential coherence. Such ambivalence stems from two systemic fractures.

SDGs and frameworks as tools of moral relativism such as the AICD’s are wielded not as compasses but as shields. Fortescue Metals (ASX: FMG) embodies this duality: its green hydrogen ventures (SDG 7) are lauded publicly, yet its iron ore operations emit 2.1Mt CO₂ annually — a Kantian betrayal of universal moral duty. Similarly, Woolworths (ASX: WOW) champions SDG 12 via recyclable packaging while allegedly exploiting inflation — a practice that epitomizes ethical nihilism, where virtue-signaling neutralizes accountability. These frameworks, stripped of normative teeth, enable moral triage: corporations selectively “adopt” ethics to offset harm elsewhere, reducing integrity to a transactional calculus.

Moreover, BHP (ASX: BHP) exemplifies the paradox of tyrannical incrementalism as a byproduct of moral imagination, investing in renewables while expanding fossil fuels — a strategy lauded as “pragmatic” but rooted in intergenerational theft. Such incrementalism is not progress but existential cowardice; it prioritizes shareholder optics over non-negotiable planetary thresholds. Nietzsche’s “last man” allegory resonates here: when ethics are reduced to risk-averse half-measures, society loses the capacity to conceptualize transformational good. The public’s neutrality reflects a subconscious recognition that incrementalism is merely harm deferred, not eradicated.

Yet, the antidote lies in ontological rigor, whereby ethics align corporate identity with unyielding moral purpose. Lithium producer Allkem (ASX: AKE) pioneers this by tying executive pay to full ecological accountability for mining’s lifecycle—a Hegelian synthesis of profit and principle. Companies must undergo existential audits, interrogating not just actions but the intentionality behind them.

Neutrality is society’s verdict: ethical theater has expired. Authenticity demands irreproachable coherence — nothing less.

Profit Over Principle? The Conflict of Interest Between Banking and Corporate Sector’s Priorities and Ethicality in Influencing Public Opinion

by Jessica McAleer

A long line of historical misconduct, persistent public skepticism, a prevalence of greenwashing. And yet, with the abundance of resources available to businesses, the Australian public deems corporate and banking sectors as ethically neutral with an Ethical Index score of 11. CBAs recent blacklisting of fossil fuel companies that aren’t aligned with the Paris Agreement feels like a step in the right direction yet it comes after being sued twice by the same two shareholders for environmental concerns. And this is where the issue in public trust lies, this perceived disconnect between financial gain and corporate social responsibility, noted by a recent COBA study indicating 75% of Australians felt most banks prioritise profit over customer wellbeing.

With only 17% of SDGs on track for 2030, this lack of drive towards ethical practice manifests itself in the Big Four. In this group, ANZ stands out. Despite publicly aligning itself with Climate Action (SDG 13), the firm is identified as the largest financier of fossil fuels amongst the Big Four. In fact, since the 2015 Paris Agreement was signed, ANZ has loaned over $19.8 billion to coal, oil and gas companies, highlighting its profit over principle ideology. To direct attention away from this, public image claims precedence, privy to the bank’s public $100 billion sustainable finance target by 2030. With the 2025 election coming up and it being revealed that ANZ ‘donated’ $50,000 to the ALP in 2022 to maintain favourable relationships, Australia’s trust is a slippery slope, however, public favorability on the ethicality of these companies has increased since 2018.

And so, with all these resources, the corporate sectors still remain in the public’s eye, ethically neutral. With larger crank down’s on potential profit, companies are moving towards greater ethical practices.

 …..

 But are they for the right reasons?

Green Bonds in Corporate Finance: A Genuine Investment or Just Another PR Move?

by Joseph-Arsenious Inaty

“Data fuels the modern economy, but at what ethical cost?” As demand for digital infrastructures skyrocket, giants like NEXTDC (ASX: NXT) position themselves as leaders in Australian innovation. In a bold move, NEXTDC issued a $1.5 billion sustainability- linked bond, pledging to develop ‘carbon-neutral’ data centres’; nevertheless, a closer look reveals that much of this “green” status comes from carbon offsets, rather than direct energy consumption reductions. Considering NEXTDC proudly claims to operate on 100% renewable energy but often consumes more electricity than entire cities, the moral fragility of “green financing tools” forces us to question: Are these bonds truly driving sustainability, or is this simply corporate greenwashing repackaged as ethical investment?

Sustainability-linked bonds (SLBs) are mechanisms employed to advance climate action (SDG 13) and industrial innovation (SDG 9) by incentivising companies to sustain energy-efficient quotas. However, when they are weakly enforced, self-determined, or reliant on renewable energy certificates (RECs) as opposed to tangible emissions cuts, we must quander whether SLBs genuinely instigate meaningful environmental change or simply reward companies for “symbolic gestures”.

NEXTDC’s commitment to ESG-performance is commendable in theory, yet contradictory in practice; their green credentials lean on market-based solutions rather than operational transformation. As data centres are projected to embody 4.5% of global electricity demand by 2030, the burden of ethical accountability intensifies – the onus on tech-sector incumbents. Offsets and indirect purchases may ‘tick boxes’, but don’t guarantee progress towards affordable and clean energy (SDG 7), nor do they ensure long-term alignment with Australia’s emissions targets. 

In this light, SLBs risk becoming instruments of reputational arbitrage. The ethical challenge is clear: How do we ensure corporate giants support measurable impact, not just marketable intentions? Should green bonds like NEXTDC’s shape the future of ethical investment, sustainability-linked finance must go beyond signalling intent – it must deliver verifiable, lasting change.

A Structural Contradiction in the Construction of Business Ethics

 

by Alina Han

The Australian community continues to have doubts about the ethical governance of large business groups - a crisis of confidence that stems not from a lack of transparency, but from a lack of substantive change. Despite frequent ethical guidelines issued by corporate boards and continuous strategic commitments made by management, in actual business decisions, ethical frameworks are often reduced to compliance documents, separated from resource allocation and risk assessment.

In a landmark event for the Energy industry in 2024, Origin Energy faced growing ESG (Environmental, Social and governance) controversy as it pursued its $18.7 billion merger and acquisition deal. Although the company systematically emphasizes its net-zero emissions roadmap to 2050 in its public statements, its capital expenditure structure toward gas exploration. The shareholder community is acutely aware of the significant disconnect between its strategic narrative and its operating practices: this not only weakens its credibility in the sustainability rating system, but also raises deep questions about the substance of its transformation strategy. Once positioned as a strategic measure to optimize the energy structure, the stress test revealed the nature of transitional risk mitigation tools.

This case reveals a structural contradiction in the construction of business ethics: When a company marginalizes ethical principles as ancillary issues, rather than deeply embedding them in the value creation model, it inevitably leads to a sustained depletion of stakeholder trust capital. Existing governance frameworks become rhetorical tools for crisis response rather than binding variables for strategy formulation. The public's apathy stems not from a lack of value orientation, but from the inertia of anticipating the failure of promises. Real organizational change cannot be achieved through rhetorical optimization in ESG reports, but depends on the ability of companies to construct credible decision-making mechanisms when short-term business interests conflict with long-term value propositions.

The Ritual of Ethics

by James Dwyer

By the early 2000’s, 81% of all Australian companies offered some form of training for their employees. Over the years, this has only increased - to the point it has become a common occurrence for every new starter in a major Australian institution to complete a series of often repetitive mandatory modules. The ideal of these trainings is to ensure all companies have ”[an] appropriate system of... internal controls”, to ensure employees abide by ethical standards and industry best-practice (AICD). Yet, how well does reality stack up with these guiding documents?

Consider the example of one of Australia’s oldest institutions, QANTAS, the ”Spirit of Australia”. During the early 2020’s, QANTAS faced a number of high-profile governance failures, including allegations of quid-pro-quo favours in order to secure market advantages. At the time public opinion turned strongly against the company. Yet despite this, QANTAS executed a change in leadership, apologising and promising to do right by customers. Soon, public opinion returned to 84% having a positive or neutral view of the company. This surprising neutrality is significantly indicative of our broader attitudes.

I contend that our neutral perception as a society of ethical corporate decision-making relates to our idea of certain rituals organisations perform to become ethical. If a company does wrong, it apologises. If you want to ensure good business ethics, make everyone complete a module. Society tells companies if they simply present cosmetic changes, they redeem themselves.

However, this thinking must be guarded against. SDG 16 calls for ”Strong Institutions” and this applies to businesses. Through holding companies accountable for substantial change to their institutional values - peering beyond the ritual - consumers can hope to improve business ethics in corporate decision making.

Ethical Decision-Making in Corporate Australia

by Manvi Saxena

Master of Commerce (Extension) student, Manvi Saxena is the winner of the 2025 Natoli Student Ethics Competition for a postgraduate student.

Despite extensive resources like ethical decision-making frameworks and guidance from bodies such as the Australian Institute of Company Directors, public perception of corporate ethics remains neutral. The big question is why does this persist?

High-profile scandals have left a lasting imprint on public trust. Cases such as the PwC tax scandal, Optus and Medibank data breaches, and Qantas' refusal to refund cancelled flights despite record profits exemplify what Roy Morgan terms "moral blindness" while prioritizing shareholder interests over community welfare. These incidents reinforce skepticism about whether companies genuinely embrace ethical principles or merely pay lip service to them.

While ethical frameworks exist, their implementation often falls short of public expectations. For instance, the Hayne Royal Commission exposed systemic misconduct in Australia's banking sector, eroding confidence in corporate governance. Ethical policies may be robust on paper but fail to translate into consistent actions that align with societal values.

Corporations frequently focus on financial performance over broader ethical outcomes. For example, Rio Tinto's destruction of Juukan Gorge highlighted a disconnect between profit-driven decisions and community or environmental stewardship. Such actions suggest that ethical considerations are secondary, fuelling public cynicism.

Transparency is essential for building trust, yet many organizations struggle with it. The Governance Institute’s findings show that sectors like banking and finance score poorly in perceived ethics due to opaque practices and insufficient accountability.

As one of Australia’s largest listed entities, Commonwealth Bank has faced criticism for its role in financial scandals revealed by the Royal Commission. Despite efforts to rebuild trust through ethical initiatives, public perception remains tepid due to past missteps and ongoing scrutiny.

To shift societal views, corporations must move beyond compliance to embed ethics into their core operations while demonstrating accountability, transparency, and genuine commitment to societal well-being.

Why Australians Remains Skeptical About Corporate Ethics - A Self-Reinforcing Cycle

by Austin Tran

Bachelor of Commerce student Austin Tran is the winner of the 2025 Natoli Student Ethics Competition for an undergraduate student.

From the public's perspective, corporate ethics increasingly resembles a branding tool rather than a true moral backbone. Companies are believed to sideline ethical conduct unless it is forecasted to increase profit. This belief is reinforced by high-profile cases of greenwashing in Australia, where companies secretly engage in unethical practices while branding themselves as sustainable.

A recent and striking example is Active Super, a superannuation fund that claimed to exclude investment in fossil fuels and gambling. Yet in 2024, after being caught investing in sectors that they proudly claimed to avoid, Active Super became the third entity in Australia to face court over greenwashing.

Worse still, organisations caught out for ethical misconduct frequently continue to operate with minimal consequence. This raises a difficult but necessary question: Are SDG frameworks truly working? When firms can selectively align with sustainability goals and face few repercussions for ethical failings, public scepticism is not just understandable, it’s inevitable.

That scepticism feeds into a self-reinforcing cycle. If ethical initiatives are viewed as hollow, they fail to generate trust or reputational benefit for firms. Without evident benefits, there would be little incentives for companies to move beyond surface-level commitments. 

Worse, some businesses have begun to practice “greenhushing” to avoid public backlash and accusations of greenwashing. In trying to avoid scrutiny, these firms have decided to speak less about their progress, and intentionally underreport their sustainability efforts. Greenwashing, alongside the rising prevalence of greenhushing, is making it even harder for the public to distinguish between genuine and performative businesses. And so, the cycle of public distrust and corporate performativity continues.

Breaking this loop requires more than better frameworks, it demands stronger enforcement and transparency. Until then, Australians are likely to remain on the fence, not because they don’t care, but because they’ve seen this all before.

2025 Student Ethics Prize Details Announced