The impetus for a Culture Audit
Culture plays a critical role in shaping an organisation’s success. It’s the DNA or glue if you will, that provides the cohesion of common purpose.
There’s no doubt about the importance of a cohesive culture for employee engagement. When we share a common set of values and behaviours, we are more likely to work together effectively and achieve shared goals. A strong culture can also help attract and retain top talent who are aligned with the organisation’s values and goals, which ultimately leads to its success.
It’s no surprise then that in today’s corporate environment, business leaders are increasingly focussed on establishing and maintaining a positive organisational culture. However, defining culture can be subjective – and of course, there can also be different cultures within pockets of an organisation. This has led to a growing emphasis on measuring culture and its many parameters and the importance of conducting regular audits to assess the health of an organisation’s culture.
A culture audit is a process that evaluates the values, beliefs, behaviours, and attitudes of employees, as well as the company’s overall wellbeing. It also includes more esoteric measures such as integration, storytelling, approach to change and candour.
Recently, I attended a workshop on Equal Employment Opportunity (EEO), where we explored several case studies that highlighted the importance of addressing culture-related issues. Some of the real-life case studies presented at the workshop ‘were appalling’ and could not be aligned with any modern-day organisation or reasonable humanistic values (how did it get that bad?). Others were less defined, but clearly culture related.
Why culture is a Board’s responsibility
With culture being such an essential aspect of an organisation’s success, it is pertinent to ask if culture should be a board’s responsibility?
Boards are responsible for overseeing the governance, assessing risk, strategic direction, and wellbeing of a company. They ensure that it operates in the best interests of its stakeholders. So, the answer to this question is unequivocally, yes.
However, despite its importance, many Boards are reluctant to address culture related issues. There are several reasons for this, including:
- Lack of understanding of what culture is, how to measure it and how it impacts the organisation
- Reluctance to take responsibility for a concept that may not be clearly defined
- Fear of opening up sensitive leadership issues or uncovering issues that may reflect poorly on the organisation
Some Boards may also believe that culture is the sole responsibility of the CEO or Head of HR. These days this function is referred to as Head of People & Culture or Chief People Officer, and I am pleased to say that I am seeing more interest from boards to appoint their next director from this professional background.
It really is the Board’s responsibility to ensure that the organisation is operating in accordance with its ESG charter and in line with its values and goals. If the culture is not aligned with these values and goals, then the Board must take action to address it.
Whilst proactive Boards may be anxious to address any culture-related issues, they may lack the necessary knowledge and expertise. If the concept of culture doesn’t immediately resonate, then the term audit may have greater currency with Board members who can recognise their fiduciary responsibility to address culture-related issues.
As Dr John O. Burdett, Global Advisor to TRANSEARCH International on Culture and Leadership says, “Culture change is not an event, it’s a journey.” Assessing and transforming an organisation’s culture and DNA is a long-term process that requires sustained effort and commitment. Culture audits are an essential tool for Boards to evaluate the true overall organisational health of their organisation. While there may be some anxiety around addressing culture-related issues, the potential benefits of conducting a culture audit make it a necessary step for any Board looking to ensure the long-term success of their organisation.
If you would like to learn more about TRANSEARCH International’s culture assessment tools powered by Orxestra®, which provide a unique perspective regarding culture, performance, leadership and team ‘fit’, please contact me or connect with me on LinkedIn.
Lindsay Craig is the Managing Partner of TRANSEARCH International Perth. Over 23 years’ experience in the retained Executive Search industry has allowed him to build an extensive and valued network of local, national and international executives and directors. He works closely with boards and senior leadership teams on structure, remuneration and talent strategies. Based in Perth and operating nationally, Lindsay has completed assignments across many sectors recruiting Chief Executive Officers, Managing Directors, RVPs CIOs, CFOs, COOs, Non-Executive Chairs and Directors, General Managers and Functional Heads. As a result of appointments in the Mining & Resources sector, he has extended his reach into North & South America, Africa, the UK and Russia. Read more…