Corporate Values: Say What You Mean, Mean What You Say

There is a lot of talk about values in the corporate world. There are also a lot of corporate webpages (the new form of corporate poster) listing the values that purport to underpin the culture of many an esteemed institution. For something so important, it's remarkable how varied are the interpretations of what a value actually is. For example, a quick look at a few companies in the upper end of the Fortune 500 shows how loosely the term is applied and a confusion between outcomes, behaviors and values: 'relationships', 'boundarylessness' (sic!), 'responsibility', 'partnership', 'performance', 'diversity', and 'respect', to name a few examples.

If behavior change, or at least the alignment of behaviors around a few core themes, is the point of most lists of corporate values, then it might be useful if there was a little more consistency in our understanding of what they are and how we applied them. I came across two definitions of values recently that are useful:

• 'The criteria people use to select and justify actions and to evaluate people…. and events' (SH
Schwartz, 1992)
• 'Principles for ordering consequences of alternatives according to preferences' (Hambrick & Brandon, 1988).

If these definitions were used in practice, it might encourage people to think harder about choosing values that have a clear connection to specific behaviors that, in turn, will drive towards a desired end result. Once you have that idea in mind, it's much easier to see the importance of ensuring values are understood and internalized by leaders and employees, and embedded in HR performance management processes, rewards, training courses and other corporate shapers of behavior. There is a natural relationship between, and flow across, values, people processes, behaviors and performance. If these connections are not made then there will be no impact on performance, and if no impact on performance, then why bother in the first place?

As I dug into the topic further, I asked myself if there is any evidence that some values are more effective than others. Jia, Lee, Moon and Li (2009) in one study and Lado, Boyd and Hanlon (1997) in another showed three important considerations which we should take into account when deciding what values our company should declare itself to be pursuing:

1: a focus on self enhancement tends to drive short term performance (for example individual ambition, competition, independence)
2: values that focus on wider stakeholder interests tend to enhance longer term performance and innovation (e.g. helpfulness, loyalty, citizenship)
3: combinations of co-operative and competitive values increase the impact on performance.

But do these lists of corporate values actually achieve anything? Do they ever drive any hard business decisions in practice? There are a few outstanding examples of companies responding to product failures in ways that reflected their core values and others who have shown impressive persistence in their commitment to a particular value, for example customer service. So, rare they may be, but these examples show it really is possible to mean what you say. Maybe all those centuries ago the stoic philosopher Epictetus gave us the right guidance when he said: First learn the meaning of what you say, and then speak. Not the other way around.