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  • Writer's picturePenelope Kenny

Good governance and it's dependency on organisational culture.

Updated: Apr 14, 2018


I love good corporate governance, and one of the most appealing factors is it requires alignment of all parts of the business from the top down. For this reason, there is no better place to start than with an assessment of organisational culture. The purpose of a culture assessment is to connect purpose & strategy to culture; to align values & incentives, and to assess & measure.

Sir Winfried Bischoff (Chairman Financial Reporting Council), stated at the launch of this report: “A healthy culture both protects and generates value. It is therefore important to have a continuous focus on culture, rather than wait for a crisis. Poor behaviour can be exacerbated when companies come under pressure. A strong culture will endure in times of stress and mitigate the impact. This is essential in dealing effectively with risk and maintaining resilient performance”.

In the course of my work, I've engaged with a very large numbers of boards, and while they are all very unique, certain patters emerge. This is most apparent with their questions about culture. here are some of the one that emerge most frequently:-

  • How can the board influence and shape culture?

  • How does the board bring corporate values to life?

  • Building trust with stakeholders?

  • How can boards assess, measure and monitor culture?

Answering these questions theoretically really isn't much use, I like to use specific examples from my own practice. I also find that if the example is too similar, the conversation can quickly turn into a 'problem resolution process' rather than a moment of learning. I am very lucky to have an experience base that I can dive into, so I can guide the boards I work with towards a breakthrough understanding on culture by taking a look at other industries and their parallel concerns. For example:-

I was working with a Food safety regulator recently, who introduced me to Dr. Lone Jespersen of Cultivate. Her Solutions Wheel is shown here. The concerns are identical. The food industry deals with life-threatening situations, in relation to food safety in the production and delivery of safe food.

Financial regulating and reporting has the same concerns. It’s time for us to recognise that Corporate Culture is identified in corporate governance. Every organisation has their own governance culture whether that is physical safety and/or corporate governance. In the following best practice blog series, I’m going to share with you some of my research, and draw out what 'excellent' might look like, based on the industries and sectors in my client base.

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