Is your board yet to realise the true value of culture?
The views of FTSE 350 board directors on understanding, shaping and reporting on culture.
Recent studies indicate that intangible assets can represent up to 80% of a company’s value. Culture is a key intangible asset, one that can help organisations reduce risk and deliver long-term, sustainable growth. For business leaders, regulators and investors alike, confidence that organisational culture is fit for purpose is crucial.
So how are boards currently assessing, monitoring, shaping and reporting on culture?
To explore this further, FT Remark, on behalf of EY, interviewed 100 FTSE 350 board directors of UK-based companies, drawn from a wide range of sectors, and including chief executive officers, chief financial officers, chairs and non-executive directors.
Their views are presented in Is your board yet to realise the true value of culture?, and show 3 clear messages:
1.Culture is vital to overall strategy and performance
2.Boards still need to take more responsibility for defining, shaping and monitoring culture
3.Investors need more information on organisational culture to support long-term performance measurement.
Our report findings point to five steps boards can take to capitalise on the value of culture:
- Make the board explicitly accountable for the oversight, shaping and monitoring of culture
- Make culture a priority at board meetings
- Take time to understand the existing culture – through both risk and value lenses
- Use local management to embed desired cultural attributes
- Improve reporting on culture.