City Values Forum
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City Values Forum and Tomorrow's Company urge boards to get to grips with corporate culture.
Following the publication of the Report on Corporate Culture and the Role of Boards by the Financial Reporting Council (FRC), the City Values Forum working with Tomorrow's Company has released for consultation a paper entitled: Governing Culture: Risk and Opportunity? - a draft guide to board leadership in purpose, values and culture. Drawing upon practical experience, research and consultations with senior chairmen and both executive and non-executive board members the guide helps them to determine how they might approach the key questions like:
Boards are accountable for culture and for assurance. They are responsible for alignment of purpose and values and for embedding the behaviours necessary to achieve their strategic goals. The guide:
EMBEDDING INTEGRITY - BUILDING TRUST
FRC CHAIRMAN SUPPORTS GOVERNING VALUES
Sir Win Bischoff, Chairman of the FRC, in a foreword to the guide writes:
"Culture is a critical element in the long term success of any business. It is both a risk and an opportunity - a healthy culture which is consistently nurtured and developed can protect and enhance the value of an organisation and help differentiate it from its rivals. As we have seen all too often, if culture is neglected this can lead to a destruction of value.
"In all of this boards have a leadership role to play and are accountable for the governance of culture
"Purpose and values embrace both strategy and behaviour. If clearly defined they can help the organisation to set a template for ethical behaviours and to embed a culture of 'this is how we do things around here'. Clarity of purpose and clearly defined values I believe are critical to the success and sustainability of any major enterprise today.
"Every organisation will have its own approach to this important topic and appropriately it is not the purpose of this guide to be prescriptive as to outcomes.
“It does however offer a practical agenda and roadmap to help boards to assess where their organisation stands in relation to their accountability for culture, to evaluate areas for priority action and periodically to assess progress."
Commenting on the guide, Richard Sermon, Chairman of the City Values Forum said,
"Especially in times of uncertainty business strategies will be buffeted by economic and political pressures and societal changes.
“A healthy culture which is aligned to purpose and defined values will serve to enhance the organisation's relationship with its stakeholders and can act as an anchor, enabling the emergence of more agile strategies while keeping the organisation pointed towards its purpose and living its values."
Richard Sermon MBE
Consultation Period : Wednesday, 20th July to Wednesday, 7th September 2016
Governing Culture : Risk and Opportunity? - a guide to board leadership of purpose, culture and values is being issued as a Consultation Draft today and is freely available on the websites of both www.cityvaluesforum.org.uk and www.tomorrowscompany.com.
It will also be circulated to all those who have been involved in the preliminary consultation process including members of The Chairmen's Forum and Tomorrow's Company Good Governance Forum. Comments and suggestions received by the cut-off date of Wednesday, 7th September will be taken into account in the production of the final published guidance which will be available for the FRC Conference scheduled for Wednesday, 20th September. Comments and contributions should be e-mailed to firstname.lastname@example.org and email@example.com.
A bank of case studies and quotations and 'top tips' from business leaders will be finally collated for inclusion in the final version of the guide and any other contributions will be considered by the editorial team.
Sir Win Bischoff
"For too long the high priests of shareholder value have told us that we must worship at the altar of financial analysis. Now, at last, after Enron, LIBOR, VW and more, boards and investors alike recognise that what most threatens shareholder value is to neglect the purposes, values, relationships and the human side of a business.
“The question is what to do about it? The answers are to be found in this very practical guide and two tool-kits.”
Founder and Chief Executive of Tomorrow's Company
The FRC Culture Coalition
While boards recognise the importance of culture, many still find it an intangible and difficult topic to address in terms of assessment, accountability and assurance. To help address this issue the FRC brought together the Chartered Institute of Management Accountants (CIMA), the City Values Forum (CVF), the Chartered Institute of Personnel and Development (CIPD), the Institute of Business Ethics and the Chartered Institute of Internal Auditors (IIA) to form a Culture Coalition to highlight good practice and promote the importance of a healthy corporate culture. Their outputs are designed to make it easier for boards to get to grips with culture and properly to fulfil their duties of accountability and assurance.
Building on their earlier work on Governing Values (2013) the City Values Forum and Tomorrow's Company have developed Governing Culture : Risk and Opportunity? - a guide to board leadership in purpose, values and culture, a practical guide for those boards seeking to define, assess, monitor, nurture and develop the culture of their organisation.
download Governing Culture: Risk & Opportunity?