As we enter the 2020s there has never been a more important time for business to think deeply about the role it plays in society. This was the idea central in a speech I gave today at the American Chamber of Commerce in Melbourne.
In it I shared how a deep commitment to our purpose and values continues to drive Telstra’s efforts to do the right thing for our customers by delivering the best technology on the best network so our customers can thrive.
We do these things because they are the right thing to do, because they align with our company purpose and values, and because they are the sort of things Australians trust Telstra to do when times are tough, as our response to this years’ devastating bushfires and our commitment playing our part in addressing the pressing challenges of climate change show.
But we don’t always get it right and if experience has taught us anything it is that even when we make decisions we think are in the best interests of our customers, there can still be unintended consequences. To illustrate that point today I shared – as a moment of truth-telling – details of a difficult issue we are currently addressing.
In 2017 we became aware of an issue where a small number of our partners had sold mobile devices and plans to customers that they ultimately could not afford and also may not have been appropriate for their needs. This included sales to Indigenous Australians, some living in remote communities. In some cases, the checks and balances we had in place to ensure this did not happen were not followed.
For us, the challenges have arisen while expanding our network to provide connectivity to communities that had not previously had it during a time of dramatic increases in data usage together with the escalating cost of smartphones. We did by not fully understand customers in those areas and we have let both them and us down.
The issue is currently being investigated by the ACCC for potential unconscionable conduct and may result in legal action against us. We will obviously respond appropriately to the ACCC but in the meantime, I can share what we have been doing about it. Put simply, we did not always meet the standards our customers expect from us, and that we expect from ourselves and our partners. We have grappled with the gravity of this issue and acknowledge the impact to the customers involved was significant.
The key question is what are we going to do about it? We have taken a number of actions:
- Implementing contact centres specifically for our rural, remote and Indigenous customers with staff specifically trained to cater to these differing needs;
- Strengthening our external credit assessments;
- Undertaking additional training for frontline staff to refresh their awareness of acceptable sales practices, along with cultural awareness and capability skills;
- Actively reaching out to customers to ensure they are on the right plan. Our work here has focused on customers who our records show have outstanding debt, or who have missed or are late making payments;
- Providing proactive support to customers who have found themselves in financial hardship by proactively buying back debt;
- The introduction of new plans which eliminate many of the causes of high or unexpected charges, including excess data charges and fixed-term lock-in contracts;
- Enhancing our performance monitoring tools, and increasing the checks and balances we have in place to ensure they aren’t circumvented; and,
- Deepening our engagement with financial counsellors and other groups on our sales approach to ensure customers are supported and our sales processes are sensitive to the needs of all our customers. This engagement will also help us identify any emerging issues and get ahead of them.
For a company focussed on building and maintaining trust with its customers and being focused on operating responsibly its incredibly disappointing when things go wrong. However, it is important we confront it squarely and address every concern. It is also important we listen to the feedback, learn from it and act.
I have visited communities in the Northern Territory and Western Australia to meet in person with some of the communities and customers affected and to hear first hand the impact these failings have had and how our program of initiatives to address them is being received. What I told them was that as Telstra’s CEO, I regret our failings and I apologised for the impact they have had. I told them these issues are not representative of the company Telstra is and that the vast majority of our people come to work everyday to do the best they can for our customers. I also told them the unequivocal commitment we have to continue to take action.
We will of course also respond to any additional issues raised by the current ACCC investigation into the matter. However, I am equally focussed on instances where our conduct, even where it meets legal requirements, still does not deliver the right outcomes for our customers, and my speech today was made in that context.
The biggest lesson for us for us is that even the simplest positive changes can have unintended consequences. You can’t set and forget. You can’t assume good intent is enough. You need to live your Purpose. Live your values. Recognise words are easy but living up to them is a daily test. That’s at the heart of responsible business.
I encourage you to read my speech and welcome your thoughts and comments.