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Definition:
Workplace culture refers to the shared values, beliefs, and behaviors that define the way things are done within an organization. It encompasses the attitudes and practices of individuals within the workplace, as well as the organization's policies, procedures, and communication practices. In the context of a corporate board of directors, workplace culture may refer to the attitudes and behaviors of the board members themselves, as well as the tone set by the board for the organization as a whole. This can range from the ethical standards upheld by the board, to the level of transparency and accountability demonstrated by the company's leaders, to the company's approach to diversity and inclusion. A positive workplace culture is critical for promoting the success of a board and the organization it governs.
Workplace culture has become an increasingly important topic in recent years, and for good reason. Companies that prioritize creating a positive, collaborative, and supportive work environment tend to perform better overall, retain employees for longer periods of time, and have a more engaged and productive workforce. Therefore, it is essential that the board of directors, the group of individuals responsible for overseeing a company's direction, strategy, and conformance, plays a critical role in shaping and maintaining a positive workplace culture.
Board of Directors Terms are the duration of time that a board member is expected to serve in their position. Generally speaking, these terms can range from one to three years, depending on the company's bylaws or articles of incorporation, with an option for successive reelection. Having defined terms for board members is essential in order to maintain continuity, accountability, and fresh perspectives.
It is important to note that some companies may have staggered terms for their board members, meaning that not all members' terms expire at the same time. This can help ensure that there is always some level of continuity and experience on the board, even as new members are elected. Additionally, some companies may have term limits for their board members, which can help prevent stagnation and encourage the infusion of new ideas and perspectives.
A strong workplace culture not only promotes employee well-being and satisfaction, but also positively impacts a company's bottom line. Productivity, innovation and collaboration are more likely to flourish than in organizations without successful cultures. In fact, studies have found that businesses with a strong culture outperform their competitors financially and have a significant advantage in recruiting and retaining top talent.
Furthermore, a strong workplace culture can also lead to increased customer satisfaction and loyalty. When employees feel valued and supported, they are more likely to provide excellent customer service and go above and beyond to meet customer needs. This can result in repeat business and positive word-of-mouth recommendations, ultimately contributing to the overall success of the company.
While the day-to-day of organizational culture management falls on the CEO and senior leaders, the Board of Directors plays a critical role in shaping and directing the overall culture of a company. The board is responsible for setting the strategic direction of the company, which includes making key decisions regarding culture. Although individual members have little direct involvement, collectively they have significant influence over the tone and direction of the company from an organisational level.
Boards can impact company culture in a variety of ways. Firstly they can advise on best practices, and provide guidance when creating HR policies or implementing new initiatives. Secondly, the board can make decisions around the company’s values and priorities to align with culture efforts. Thirdly, they can use their positions of influence to promote cultural Awareness campaigns or put out messages of support through communication channels.
One common challenge faced by boards of directors is a lack of time to focus on culture. Board members have demanding schedules and limited availability, so finding time for discussions on company culture can be difficult. Also board members tend to represent stakeholder interests and agenda priorities may not align with culture initiatives. Further, boards of directors can be out of sync with the ground-level workings of the company.
There are several strategies that a board of directors can use to enhance a company's workplace culture, even in the face of these challenges. Firstly, the board can set aside dedicated time for discussions on culture during board meetings, with an aim in mind. Secondly, board members can make an effort to remain connected with the company by attending internal meetings or by conducting a culture audit. Thirdly, the Board of Directors can focus on recruiting carefully to find individuals who align with the culture vision.
One example is Adobe. In 2014, Adobe identified a culture that wasn’t aligning with their vision. To develop a strategy, the board conducted a thorough company-wide culture audit. Building off the information gathered, they established new initiatives to strengthen the culture and better align with their vision. One significant development was their adoption of a test-and-learn culture and fostering an environment where experimentation was rewarded and failure was acceptable. In a subsequent audit, Adobe saw improved performance from 71% of their employees. Another example is Google, which has been consistently ranked as a top place to work by Fortune, largely based on its strong culture, meticulous hiring practices, and innovative workplace initiatives.
While every company’s culture is unique, there are several established best practices that boards of directors can follow to foster a positive workplace culture. Boards can ensure that the organization's strategy includes culture as a top priority, prioritise communication and alignment throughout the organization, provide regular education and training opportunities, and work diligently to ensure that the organization's subcultures are aligned with the overall company culture.
It is necessary for boards of directors to define clear metrics to measure the success of their efforts in building and maintaining workplace culture. It can be helpful to administer regular surveys, feedback channels, and other avenues for employees to share their experiences and perspectives, as well as using reviews and success stories as benchmarks for improvement.
As a board member or a manager, it is important to foster a work environment that prioritises employee wellbeing and retention. Successfully creating a positive workplace culture takes time, effort and investment from everyone involved, but the payoff is a higher level of employee engagement and productivity, which leads to successful business outcomes. Hence it is very important for the companies to have a culture champion.
