6 minute read 21 May 2019
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How boards can enhance the governance of culture

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US Americas

Multidisciplinary professional services organization

6 minute read 21 May 2019

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In this webcast replay from the Better Questions for Boards series, we discuss how boards can govern culture more effectively.

Companies are becoming less defined by physical assets and more by human capital than at any other period in history. In today’s environment, a company’s culture and talent are mission-critical to the success of strategy and to creating competitive strength. The board plays a critical oversight role of the various dimensions that shape culture.

We invited business leaders to discuss what culture is, how it should evolve, and how boards can govern culture more effectively.

Our panel includes:

  • Joan Amble, board member of Sirius XM, Zurich Insurance Group, Booz Allen Hamilton, and a member of the commission that published the NACD Blue Ribbon Report on culture as a corporate asset
  • Joe Dettmann, Ph.D., Principal, People Advisory Services, Ernst & Young LLP
  • Matt DiGuiseppe, Vice President, Head of Americas on the Asset Stewardship Team, State Street Global Advisors
  • Hervé Tiberghien, Chief Human Resources Officer, PPG

Watch and listen to featured video clips below, or access the full replay here:

Better questions for boards webcast series

Watch and listen to an insightful discussion on enhancing board oversight of culture.

Access the replay

In the discussion, panel members highlighted the multiple roles culture can play in an organization’s success, and how communication from the top down can help spread a winning culture throughout a business.

Tone at the top is just the beginning, said Joan Amble, a board member of Sirius XM, Zurich Insurance Group and Booz Allen Hamilton.

Communicating the strength of the company culture is paramount.

Directors should think about how to position company culture as a strength, says Matt DiGuiseppe, Vice President and Head of Americas on the Asset Stewardship Team at State Street Global Advisors.

Joe Dettmann, principal for EY People Advisory Services, says that companies should constantly evaluate their culture to make sure new things are accomplished with intentional change.

All systems and behaviors should be connected to what you want to do as a company and why you want to do it, he said.

Hervé Tiberghien, Vice President of Human Resources, PPG, advocated for communication and dialogue.

What we heard from the audience

During the webcast, we also asked our audience polling questions. Here’s what they told us.

Through questions and feedback submitted, the webcast audience affirmed the challenges they face in embracing strategic shifts as well as finding the right "balance" or approach to enable the level of time and discussion around strategy and corporate culture to meet the company’s current and evolving needs. In particular, we heard from directors that while culture is recognized as an imperative topic, it is probably not given the sufficient attention and oversight it deserves.

Where does oversight of culture reside within your board

Directors also indicated that they seek to gain a better understanding of the board’s role in overseeing culture using the appropriate metrics, including consideration of various sources of information and the leveraging of the internal audit function to better assess the health of the organization’s culture.

Mitigating the orgainizations behavioral risks

Key takeaways

Boards should consider the following five ways to enhance how they govern culture and support management in realizing culture’s value:

  1. Oversee how culture is defined and aligned to strategy.
  2. Create accountability for how culture is lived and how it is communicated both internally and to key external stakeholders.
  3. Monitor how culture and talent metrics are measured to keep a pulse on how culture is evolving, including elevating the role of the Chief Human Resources Officer (or equivalent).
  4. Provide oversight of intentional culture shifts to stay in step with strategy shifts.
  5. Challenge the board’s culture.

Summary

Culture is the backbone of enterprise, and boards can help set its tone from the top. Boards should continually evaluate, communicate and evolve the company culture to exploit it as a valuable asset.

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By

US Americas

Multidisciplinary professional services organization