Qantas Case

EXECUTIVE SUMMARY

The purpose of this report is to provide advice to an ethical investor in Qantas by evaluating Qantas in terms of ethical and business issues. This report will examine how ethically Qantas has treated its staff, which is involved in business ethics. This report also analyses Qantas profitability from 2007 and 2011 financial year. The results of survey disclosed that Qantas adopts unfair treatment towards its staff concerning the issue of balancing employment between the oversea and local labour markets. The report also finds that final profit of Qantas decreased from $673 million in 2007 to $249 million in 2011.The report concludes that Qantas is not ideal company in both ethical issues and business perspective. It is recommended that an ethical investment in Qantas has high risks unless Qantas solve its employment problems.

INTRODUCTION

Choosing a potential profitable company as an ethical investment is a difficult and important decision, and should be made very carefully. The aim of this report is to provide some advice about ethical investment in Qantas. Ethical investing is defined as an investment process that investors focus on ethical issues such as environmental and social factors when choosing investments, besides the achievement of a financial return (Hudson 2005, pp.641-657). Australian Ethical Investment Ltd (2011) stated that there are three ethical investment methods that are adopted by ethical funds: “negative screening, positive screening and corporate engagement.” Generally, investors prefer to positive industries and choose the best companies that meet with ethical criteria (Australian Ethical Investment Ltd 2011). Qantas is Australia's largest domestic and international airline, which is founded in the Queensland outback in 1920. The Qantas Group is divided into three closely related parts: Commercial, Customer and Marketing, and Operations. After more than 80 years of development, Qantas has became a airline group whose main business is the transportation of customers using two complementary airline brands - Qantas and Jetstar. Qantas operates Qantas Frequent Flyer and Qantas Freight. Jetstar, the Group’s low fares airline also manages the Jetstar Asia operations based in Singapore. This report will list and evaluate an ethical issue about Qantas firstly, then illustrate Qantas’s profitability from 2007 to 2011.Finally, it will make a recommendation as to whether Qantas is suitable for an ethical investment or not.

ETHICAL ISSUE AND EVALUATION

Business ethics are related to issues dealing with business, such as the rights of employees, obligation of companies, advertisement and patent (Allhoff & Vaidya 2005, introduction p. xxvi