Following are headlines from various articles and opinion pieces that have appeared in the Australian Financial Review during March:
ANZ offered $50m to settle market rigging case – 5-6 March
CBA fails sustainability test – 11 March
Banking on cultural change – 12-13 March
NAB, ANZ review life after CBA scandal – 14 March
Reading the articles it’s clear that there is a leadership issue and if there is a leadership issue then as one of the headlines suggests there can be little doubt there is a cultural issue. These various situations have attracted the attention of the Australian Securities and Investments Commission (ASIC) and the Australian Prudential Regulation Authority (APRA) and there will be inquiries, and recommendations for change emanating from those enquiries all of which will be warranted.
However, it’s unlikely they can directly address leadership accountability and culture which seem to be at the heart of a number of these situations. Forget the academic definitions of culture; in plain and simple terms culture is what’s valued in any organisation and the behaviours that are encouraged, discouraged, and tolerated by leaders.
The evidence is irrefutable from research by Cooke et al that in any organisation, culture is shaped from the top and that makes those leaders at the top of an organisation accountable for the cultural outcomes.
Values underpin culture. The core Values in any organisation are deeply ingrained principles that shape and guide all of a company’s behaviour and actions; they serve as its cultural cornerstones. There is little doubt that these institutions involved have stated core Values. The real questions are whether they are alive and being lived and modelled daily by the leaders at every level. It would seem not to be the case in many instances if we take at face value what is reported in the media, as aberrant behaviours were not discouraged or at best were tolerated, turning the blind eye so to speak – largess of expenses, how people who opposed activities were dealt with and how customers were dealt with and so on.
Many organisations are realising that their culture is one of the few, if not the, only remaining source of competitive advantage they have and their cultures need to be valued, nurtured and protected. Many Boards and executive leadership groups are now listing culture as a regular agenda item for discussion in their meetings and yet many are not. Until culture is listed on meeting agendas and discussed as regularly as financial performance, there is no doubt instances of cultural dysfunction will continue to occur again in organisations at some point in the future.
One last thought to consider; which leaders within your organisation have culture as a stated KPI against which they are measured, and are you able to you remember when culture was a specific agenda item in a leadership meeting you attended?
Viventé Australia enables leaders and managers to create the conditions that allow their people to do their best work every day thus creating a powerful advantage: the synergy between people, leadership, management, and culture, produces performance that allows your business to achieve its outcomes.