Good Corporate Culture is a Process, Not an End Point
by Robert Gordon
Posted: 1 Oct 2014
[This comment piece first appeared on the Chartered Global Management Accountant (CGMA) website]
Corporate culture is an amorphous concept. We all experience its effects and have an implicit understanding of what is being referred to, but it's difficult to pin down. Companies are keen to message to employees and stakeholders (including regulators) that some behaviours need to change - that the lessons of the global financial crisis are being taken seriously. There is broad consensus that we are facing a systemic culture problem, and in relation to this good culture is defined as aligning employee values and behaviours with the (hopefully positive) values of the business they work for. Most attempts to encourage such an alignment tend to look at governance structures alongside the checks and balances of management interventions around hiring, training, remuneration and career advancement.
Overall, a major part of the problem seems to be the tendency to see good corporate culture as an end point rather than an ongoing and perpetual process. Culture is pervasive and all-encompassing. You can't demarcate the lines between where your internal corporate culture ends and the wider social culture begins - they are part of a unified system of influence and activity. Culture is how we collectively create and express meaning through a never-ending process of reciprocal learning, which means that corporate culture will always be in dialogue with the society that it operates within. There is no separation, no closed system, and the overlap is not merely at some artificially designated touch point such as the 'consumer' or 'environment'. What this means in practice, is that we must take on board a sense that good corporate culture is not static - it is a dynamic medium of expression and dialogue rather than a fixed operating goal.
When you begin to examine what such an approach means you can quickly see the difference it makes. Rather than stopping once you have implemented ever more checkpoints on employee output, you open up discussion between levels (and across departments) of your organisation in order to arrive at a shared vision of purpose. Instead of being satisfied that your annual reporting numbers reflect underlying commercial realities, you seek to openly explore the wider value of your business through integrated reporting. Instead of relying on particular 'culture champions' to instigate and lead the way with a positive ethos, you carefully consider the infrastructure needed so that a sustainable culture permeates your operations and is not dependent on particular individuals. In this way good corporate culture is not something that a company does, but rather is a direct outcome of what the company is.
Your corporate culture is the collective will behind the purpose of your business - the truth behind the rhetoric. It is not an easy path to implement successful management strategies, productive incentive structures, and values-driven decision making. It does help, however, if you see the path as a corporate lifestyle change rather than a quarterly target. Good corporate culture depends on viewing the purpose of your business as a process that unfolds dynamically and adapts to external pressures and societal changes. In order to right the wrongs of the recent past, we must learn to see good corporate culture as an ongoing process - not merely an end point that we can fulfil the criteria for and then move on.
The opinions expressed in this article are those of the author, and do not necessarily represent the views of St Paul's Institute or St Paul's Cathedral.