Will the scathing report from the Royal Commission into misconduct in the Australian banking industry be the wake-up call for corporate Australia to focus on their values and culture?
“Changing culture and governance” is one of the recommendations in the final report and includes suggestions for all financial services entities to take proper steps to:
As Graeme Samuel AC, co-author of the APRA Prudential Inquiry (called “required reading for every board member in Australia” by then treasurer Scott Morrison) into the culture, governance and accountability of the Commonwealth Bank of Australia and Professorial Fellow in the Monash Business School, wrote in the Financial Review, “Corporate Australia generally should study the governance and culture sections of both reports—they contain valuable insights and lessons for everyone responsible for the governance of our business organisations.” In both reports, recommendations urge businesses to ask, “Should I do this” rather than “Can I do this” to operate beyond reproach.
While misconduct exposed by the report was outrageous and those in charge continue to deal with the loss of reputation and position (deservedly so), it wasn’t the first public warning businesses could learn from. Last year, the Australian Cricket team abandoned its core values and resorted to ball tampering in an effort to “win at all costs.” If they would have adhered to their core values, the scandal would have never happened—it’s quite clear that cheating to win was a violation of their values.
So, what are the steps you must take to build a market leading Culture & Core Values?
Whether you’re a financial institution, a cricket team or leader of any other organisation, you must define a set of core values that all members of your organisation will live by every single day. Core values that accurately reflect the nuances of your organisation’s personality are key to maintaining a cohesive culture. A commitment to a clearly defined set of core values helps staff, management and leadership teams know how to behave and helps guide decision-making. Core values also influence how people are expected to interact with one another and their work ethic.
Many firms spend thousands of dollars and many months trying to develop their core values, but the approach I prefer is from Jim Collins that directs you to discover your core values through an exercise called “The Mars Group.”
In order to test the effectiveness of your core values on your company culture and asses if they are alive and fully functioning, ask yourself these three questions from the Core Values Test:
While Roseanne failed to live out the company’s core values, the president of ABC Entertainment Channing Dungey did when he stated, “Roseanne’s Twitter statement is abhorrent, repugnant and inconsistent with our values, and we have decided to cancel her show.”
Once defined, values will do nothing if they just live on your wall. All the people in your organisation need to embrace the core values. They should be integrated into every system from the recruiting and hiring process to performance evaluations to everyday management and decision-making. Since total commitment to values is easier said than done, here are eight ways to keep your values alive in your organisation:
When I work with businesses ready to scale, one of the first things we tackle is the Core Purpose and Core Values of the company, because these set the foundation for business success.
I hope you have enjoyed these insights. Have a great week, and stay growth-focused! Interested in hearing more? Call me on +61 408 748 980 or email me at email@example.com
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Scale Up Growth Partners is an Australian Business Advisory and Coaching firm that works with mid-market growth companies with revenue between $1M and $100M. We equip growth company leaders and executive teams with the knowledge and tools they need to scale their businesses. Scale Up Growth Partners purpose is to Grow Remarkable Leaders and Companies.