The board and culture

Nov 13, 2017
Recent events serve to reinforce the integral role the board must play in understanding and overseeing organizational culture.

The destructive pressures that permeated Wells Fargo and the massive cyber breach at Equifax, for example, have prompted some to argue that boards need to focus more on corporate culture, values and behaviors.

Other recent scandals involving systematic sexual harassment and bullying in the workplace at high profile firms have turned a spotlight on potential lack of board oversight. Despite this, boards are not responding quickly enough. One recent poll shows that most boards in the U.S. are not discussing sexual harassment and do not consider it to be a problem in their organization.

While American companies have received the lion’s share of attention concerning these issues, it is important to remember that Canadian organizations are not immune from such behaviours and the negative impact to reputation, brand and value can be swift.

Board culture is a critical factor in this discussion with more attention given in recent years to getting this right. Many directors are able to identify those qualities they look for in effective colleagues but it remains the case though that not enough thought may be given to how diversity can be a driver of a more positive culture. There are concerns that Canada, in particular, is still not making enough progress on gender diversity.

Creating respectful workplace cultures is in the corporate interest and for directors, beyond the clear business advantages of integrating culture and values with strategy lies another consideration: as board mandates expand to include oversight of organizational culture, so too does board accountability.

Source: Director Lens November 13, 2017