Corporate culture is a “standing item” for half of businesses across the globe, as the issue becomes more entrenched on corporates’ agenda, according to a report by Grant Thornton.
In its report, Beyond compliance — The building blocks of strong corporate culture, the accountancy firm found businesses are moving on from merely discussing culture and setting it as an area of importance, towards measuring and understanding what it means for them. Some 50% of the 2,500 businesses questioned said culture is a set agenda for the board.
It found that 72% of businesses have established internal controls addressing culture and employee behaviour. This figure rises to 78% in the UK, while European counterparts Germany and France scored just 50% and 39% respectively.
Sarah Bell, Grant Thornton UK head of leadership and culture, said: “Conversations have changed over recent years: from a time where culture either wasn’t seen as important, or was seen as important for value-protection and avoiding failures, to now understanding culture as a way to create value and gain competitive advantage.”
More than half of respondents consider a business customer’s culture (63%) and a supplier’s culture (57%) as part of the process of setting a good culture.
However, of the factors viewed as most critical to reputation and brand image, the environmental impact of operations and level of diversity in the workforce are ranked low on the list of priorities, well below that of product/service quality, customer service and innovation.
“It is surprising to see environmental and diversity issues so low on the list,” said Simon Lowe, chair of the Grant Thornton Governance Institute, Grant Thornton UK, “when you consider how much discussion there is around those two issues at the moment — particularly in relation to businesses and corporate social responsibility.”
The firm has called on businesses to examine the formal drivers of culture, such as leadership; strategy; corporate responsibility; people management; resource management; and process — then evaluate the findings against the perceptions of employees and other stakeholders (e.g. customers, suppliers) to finds gaps or misalignment.
A sample of people within the business should also be asked about “what it’s really like on the ground”.