24 August 2016 by Alexandra Jones
Today’s organisations are considering much more than just the business at hand
Over the past few decades, the governance industry has grown exponentially to help companies conduct themselves in a way that is responsible. From considering environmental, social and governance factors, to complying with the very latest regulation, many of today’s organisations are considering much more than just the business at hand. By doing so, organisations are more sustainable, and in the process not only generate profit but have a positive impact on society.
Although it is undoubtedly essential that an organisation is underpinned by responsible practices, complying with the latest governance and compliance requirements alone does not necessarily make an effective organisation. It is a positive culture, that is embedded throughout a business and reinforced within every layer, which will enable it to thrive.
Yet, herein lies a challenge for organisations: what exactly does culture mean? And, what does an effective culture look like? This all around ubiquitous issue is fundamentally difficult to pinpoint because what makes a positive culture in one company is different to the next.
I recently spoke with Sir Win Bischoff – read the full interview 'Culture by design' – who explained what culture means to him: ‘[It] is a combination of values and attitudes, and the behaviour they drive, the purpose of the company, and the way that stakeholders are treated – staff, customers, society and so on. It is a broad area which impacts the behaviour of the company and the way that it is seen in the outside world.’
Several of our authors this month tackle the issue. The Financial Reporting Council, 'The power of people', suggests that compliance with the UK Corporate Governance Code alone ‘cannot prevent inappropriate behaviour, strategies or decisions. Only the people, particularly business leaders, can do that.’ Similarly, our article 'A culture of commitment' from the Association of Chairs, highlights how important it is for chairman to instil a positive culture from the top of the organisation down.
I hope the ideas on culture in the articles that follow give you a better sense of how important the more intangible aspects of business are.