Can Ethical Corporate Culture and Compliance Co-Exist in Today’s Digital Workplace?

True story here. A few years ago, I sat with the Sales VP of a major corporation I worked for. We were good friends and decided to meet over lunch. I was relocating. He was recruiting me to become part of the new regional team.

“I appreciate your offer,” I responded. “But working for Company X morally, ethically and spiritually compromises me.” He leaned back in his chair, looked me in the eyes, and sighed. He had absolutely no response to my statement.

What percentage of your workforce holds that same perspective, but unstated?

The pace and cadence of digitally-connected organizations challenges the concept of ethical corporate culture.

How large are the gaps between employee handbook content, corporate mission and vision statements? How consistently and successfully are these ideas embraced, enacted and reinforced in the workplace, each day?

Can abstract values reinforce a digitally-underpinned, ethical corporate culture? 

The concept of the values-based organizational culture originates from Edgar Schein, Emeritus Professor at MIT Sloan School of Management. His seminal work, Organizational Culture and Leadership (originally published in the 1980’s), defines three distinct levels of organizational culture. (Yes, I’ve read the book).

Cultural artifacts are observable elements such as dress code and office lingo. Then, espoused values define the organization’s value system, including behavioral rules and how employees represent the corporate behavioral norm to each other and to outsiders. Finally, shared assumptions include deeply embedded behaviors which may not be documented, but certainly are inferred. Shared assumptions anticipate how employees react to situations.

However, the dynamics of the digital workplace offer a fresh set of value challenges. First, the post-industrial concept of remaining an employee “for life” is no longer the workplace norm. Many employees have expiration dates contingent on career strategy, performance or organizational shortcomings, or merger and acquisition. Then, leadership may be hired to flip the organization rather lead it into perpetuity. Also, a growing segment of the workforce are migratory and transient: gig-employees or remote digital workers.

As a result, creating and transferring a value continuum across the corporation is easier said than done. Ultimately, the survival of ethical corporate culture relies on employee integrity.

The challenge becomes how to quantify the abstract, qualitative notion of ethical corporate culture. 

Levels of employee engagement, external factors impacting security, and often departmentally-specific churn, exert selective pressure on the viability and evolution of ethical corporate culture.

Perhaps the best compass ensuring continued cultural quality becomes hiring for integrity. Integrity should, by its nature, defy shape-shifting trends and fads. The 2015 Deloitte report on building world-class ethics and compliance programs targets a positive culture of integrity as the program’s ground zero.

Integrity is defined as being honest, having strong moral principles, being whole and undivided. Integrity differs from loyalty in that loyal individuals pledge support or allegiance, regardless of being motivated by strong moral principles.

Within an ethical corporate ecosystem, the goal becomes attaining high levels of agreement based on shared assumptions (remember those?) about what is positively valued by an organization. In addition, shared agreement is reached about what is negative and devalued. In addition, these shared assumptions infer an equally high level of intensity, passion and engagement around showcasing those agreed-upon values.

Will rules-based compliance programs guarantee values-based employee and leadership integrity?

However, digital transformation of the workplace brings with it new selective pressures for survival of the fittest corporate culture. Enter federally-mandated safety, security and regulatory requirements. As a result, organizations become busy with their tangible artifacts: various compliance To-Do lists.

Consequently, corporate values and ethics become synonymous with assessing, measuring and auditing compliance to rules and regulations. Furthermore, preserving organizational “culture” dissolves into producing audited, assessed, measured and analyzed compliance reports. After all, these quantifiable, documented results demonstrate to stakeholders, stockholders and regulators that an organization, and its employees, follow stated rules.

However, this trajectory evolves human resource professionals into compliance police. What is lost in translation is their potential role in co-creating human capital strategy leveraging an ethical corporate culture.

What happens when rules and regulations shape-shift in response to external pressures? When leadership and compliance personnel lack integrity, the organizational value system disintegrates. As a result, executing compliance and risk management strategy may not ensure the preservation of core ethical values and behaviors

At best, ethical human capital hiring strategy leverages critical thinking skills and workplace responsibility.

Perhaps a better strategy for curating ethical corporate culture leverages a human capital strategy emphasizing employee ownership of and responsibility to commitments and agreements. When this model is adopted, the target is hiring for critical thinking skills as well as functional skill sets. These core skills include the ability not only to discern right from wrong, but also involve providing cultural avenues to take action.

After all, creating an enduring, ethical corporate culture curates a set of commonly espoused, shared positive values and behavioral norms. These norms and values enhance employees’ own value sets. Otherwise, employees become disenchanted, unproductive and unengaged because they lose belief in organizational ethics. When that happens, you potentially create a sandbox for moral, ethical and possibly even spiritual compromise.

Photo Credit: dominicatorumstudiorum Flickr via Compfight cc

Want To Build A Business? Lead With Trust

If you could define business success, what would it look like to you? Would you focus on market share? Growth rate? Revenue? Profitability? Or something else?

At young companies, conversations tend to revolve around how to raise seed funding, where to invest capital, and how to compensate key contributors. Often, it seems that our perception of business success (or failure) largely revolves around money.

While it is true that a well-run company requires appropriate funding and sound financial management, I would argue that there is something even more vital to the sustained growth of any venture. It’s not something you can buy or sell — nor does it come prepackaged on a shelf.

I’m talking about trust.

Broken Trust: Good Examples Of Bad Behavior

From the Enron debacle to the Madoff scandal, stories of insider trading and fraud have captured headlines far too frequently. Our nation is losing faith in corporate leaders, and there’s a growing demand for corporate accountability and transparency.

The only way to turn this around is for those at the top to take responsibility and lead by example. We must create open, transparent cultures that promote accountability, integrity and honesty.

The truth of the matter is that employees need to know what’s going on in order to feel connected with their work and perform at their highest level. Staff concerns about the stability and the health of the company are a distraction that can erode trust, inhibit productivity and have a negative impact on the bottom line.

Creating an environment of trust goes far beyond releasing quarterly reports. It requires a daily commitment to transparency that’s infused into all aspects of business operations, and reaches all levels of the organizational chart. Most importantly, it requires team coaching and open communication across all functions, with management that listens and responds to constructive criticism.

Trust Is The Cornerstone Of Culture

Leadership legend, Stephen M. R. Covey said:

“High trust is a dividend; when it goes up you’ll find that everything happens faster and cost goes down. It’s that predictable.”

Although trust can take a long time to build, once we have achieved a state of trust, we often take it for granted. But the fact of the matter is that trust is at the core of the daily work activities that collectively make up company culture. As Deborah Mills-Scofield explains in the Harvard Business Review:

“Trust trumps everything. And everything flows from trust — learning, credibility, accountability, a sense of purpose and a mission that makes ‘work’ bigger than oneself.”

When it comes to trust, the whole is bigger than the sum of its parts. For example, many startups have created cultures based around staff perks like a ‘no vacation policy’ vacation policy, providing employees with top-of-the line equipment, offering flexible hours, and letting staff work from home. While benefits like these may attract and retain top talent, there’s also a higher mission. Companies that offer these unique self-directed work options are sending employees a message that says, ‘I trust you, and I trust your judgment in using these privileges.”

Earlier this year, HubSpot released its long-awaited Culture Code – a presentation that summarizes the organization’s nine core beliefs. The document is remarkable because it emphasizes that trust is at the center of Hubspot’s organization. Rather than creating binders full of company policies, HubSpot has created a simple three-word policy for nearly everything: use. good. judgment. From social media activity, to travel expenses, to sick days, HubSpot understands that a healthy company starts with trust.

The Trust/Time Ratio

Of course, trust is a two-way street. Not only is it essential for employees to trust management, but leaders must trust their teams, and feel confident in their ability to move the company forward.

As Stephen M.R. Covey explains in his book, The Speed of Trust, trust is the great liberator of time and resources. It’s also an essential condition for growth. He notes that “when trust goes up, speed will also go up and cost will go down,” and that “when trust goes down, speed will go down and costs will go up.” Therefore, he concludes that the speed at which you can grow a business is directly proportionate to the time that you invest in creating trusting relationships.

Leading By Letting Go

One of the most important lessons I learned as a CEO was the importance of trusting your team. As the leader of any organization, large or small, your primary job is to communicate the vision; give your people the information, tools and resources to move toward it; and then get out of the way. This frees your staff to be as productive as possible, while allowing you to focus on your responsibility to drive the company forward, strategically.

The truth is plain and simple: if you’re a leader who wants to grow a company, you must have faith in your staff to get the job done – without you hovering around their desks. It is impossible to innovate while being bogged down in the daily minutia of your company. Trust allows you to remove yourself from the details and create necessary space to focus on long-term growth.

Trust is a natural human instinct, yet we tend to over-complicate it when we try to apply it to the business world. The best way to create a culture of trust is to begin by being open and honest with ourselves and those around us. By committing to being transparent in all our interactions, we will gradually create a culture of trust around us. And as trust grows, we should expect to see business results follow.

How do create and sustain trust within your organization? What results do you see?

(Editor’s Note: To discuss World of Work topics like this with others in the TalentCulture community, join our online #TChat events every Wednesday, from 6:30-8pm ET. Everyone is welcome. Learn more...)

Image Credit: Pixabay

Leadership, Visible From the Inside Out: #TChat Recap

 “People don’t want to be managed. They do want to be led.” via Cynthia Stewart, Lead Change Group

It seems fitting that the first 2012 U.S. Presidential Debate immediately followed this week’s #TChat session – especially since our discussion focused on what it takes to be a great leader.

Coincidence? Or genius? Actually, we didn’t plan a political connection. Instead, we wanted to showcase a newly launched book, “The Character-Based Leader – Instigating a Leadership Revolution, One Person at a Time,” which was written in part by’s very own co-founder, Meghan M. Biro.

However, I can’t resist connecting the Presidential dots. After all, the debate forum is perhaps the most visible litmus test for candidates who hope to lead the free world. It’s an executive-level job interview on a national scale. And the #TChat community knows more than a thing or two about how to attract, retain and develop great talent. So who better to outline America’s leadership requirements than our tribe?

Although we didn’t frame the discussion in political terms, there was plenty of wisdom shared about leadership qualities that matter most – not just for those who aspire to be President, but for anyone who wants to spearhead an organization, team or initiative.

(NOTE: For session highlights directly from the #TChat stream, see the Storify slideshow at the end of this post.)

What Does a Good Leader Look Like?

Last week, we offered a framework based on action…

“Leading is learning. Learning is doing. And doing is knowing. So do.”

And this week’s exchange built on that concept…

“We follow people because of who they are, not just what they do.” via Transcend Coaching

But this begs the question – how do we evaluate who leaders really are? What qualities matter most? Meghan Biro’s recent Forbes blog post suggests that we start with 5 core attributes:

  • Integrity
  • Trustworthiness
  • Emotional Intelligence
  • Openness
  • Motivation

Of course, other factors can come into play too. There’s no single “right way” to be a leader. Which points to another insightful comment from the stream:

“Good leadership comes in many forms, but is easy to identify…” via Valerie Merahn Simon

This speaks to two factors: consistency and visibility. Good leadership is as unique as the individuals who carry that responsibility. But continuity within an individual leader is mission critical. Otherwise followers risk losing their bearings, especially in fluid, unpredictable environments. Second, leaders must have a high tolerance for transparency – especially in a world that’s digitally connected and socially engaged. Word doesn’t just travel fast these days – it travels at light speed. As high-profile examples have proven in recent years, there are no hiding places for leaders who are less than authentic.

Not to suggest that perfection is the goal. Great leaders aren’t super heroes. They’re human beings. They’re a work in progress. Leaders are vulnerable to missteps, blind spots and lapses in judgment. But it’s how they deal with failure – their own and those around them – that often sets leaders apart.

Do Good Leaders Make a Real Difference?

We can talk endlessly about the benefits of working with leaders who are driven by character. But what does it actually mean for the bottom line?

“Research shows there is a direct connection between employee engagement and retention and long term profits.” via Don Shapiro

We’ve all known examples of those who’ve led through greed, intimidation or even incompetence. But that’s not a sustainable model – especially in workplace ecosystems, where market forces ultimately decide an organization’s fate. Poor leadership jeopardizes immediate performance. Moreover, it has implications for long-term business viability. Consider this recent item from Corporate Responsibility Magazine: “Companies with Bad Reputations Shunned Even by Unemployed Workers.” Ouch.

So, it seems that leading with character is not just a good idea. It is actually good business. Of course, it’s also good governance for nations everywhere. I, for one, hope our nation’s future leaders agree.

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Highlights & What’s Ahead on #TChat

For more insights from the stream, watch the highlight slideshow below.

Did you miss the #TChat preview? Go here.

Also, if you’re a blogger, and this #TChat session inspired you to write about leadership, we’re happy to share your thoughts with others! Just post a link on Twitter (at #TChat or @TalentCulture), or insert a comment below, and we’ll add it to our archives. There are many voices in the #TChat community – with many ideas worthy of sharing. So let’s capture as many of them as possible!

Yesterday’s session only scratched the surface of the leadership equation. In coming months, we look forward to drilling down, with deeper discussions around sidebar topics that emerged in yesterday’s exchange. Stay tuned!

SPECIAL THANKS to Susan Mazza (@SusanMazza), founder of Random Acts of Leadership and thanks to other co-authors of The Character Based Leader who joined the discussion! Developed as a collaborative effort by the Lead Change Group, this book represents the collective wisdom of 21 professionals who not only talk leadership talk, but have walked the walk across corporate environments. Their ideas and inspiration come from real-world scenarios – and are worthy of our attention.

We look forward to seeing you next Wednesday at 7pmET/4pmPT for another #TChat. Next week’s topic: “HR Moving at the Speed of Business.” Look for the Preview next Monday via @TalentCulture and #TChat. Enjoy your weekend!

#TChat INSIGHTS Slide Show: The Character Based Leader
by Sean Charles (@SocialMediaSean)

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Top #TChat INSIGHTS: The Character Based Leader

Storified by TalentCulture · Wed, Oct 03 2012 21:48:38

Can ya dig it? #TChat tonight discussing “The Character Based Leader” w @MeghanMBiro @SusanMazza Charles
@ilovegarick Bella says “Hi, #TChat!” Mecklenborg
@SocialMediaSean OK I didn’t do the huge hair today so this is what you get. My #Tchat game face! Zuehlke
Live from the Hilton Garden inn Atlanta #tchat #hotelwine LaCroix
My dog, Paul, all chilled out for #TChat. Aucoin
Q1: Have our expectations of people in positions of #leadership changed in terms of their skills, approaches, values, etc.? #tChatSusan Mazza
A1 The dramatic rise in the speed of change demands more from leaders than ever before. #Leadchange #leadrev #tchatDon Shapiro
A1: To be effective a leader must have influence with out influence we’re only left with a dictator. I’ve had a couple! #TChatRobert Rojo
Q1: I believe we are heading towards a new area where the sheer transparency in communication and will demand ethical leadership #tchatIrene Becker
A1: Leaders need to become masters of their egos. Be able to catch when ego interferes w/decision making. #tchatTony Vengrove
A1: Position no longer carries as much “automatic” influence as it once did. You have to earn it. #tChatSusan Mazza
A1: Title does not “entitle”! #tchatKathy Herndon, GPHR
A1. Our expectations have changed. We want then to not only lead but inspire and engage too. #tchatSabrina Baker
Q2: Does the character of an org’s leaders & staff matter to the bottom line? Why or why not? #TChatSusan Mazza
A2 we have to be affected by character based leadership. I don’t want to work in a morale vacuum. #tchatKeith Punches
Q2: Without character, the bottom line suffers. Just look at Enron. #Integrity is everything & #leaders set the tone. #TchatLara Zuehlke
A2: The collective character of an organization’s leaders can impact employee actions & even public perception. #tchatSalary School
A2: Character emanates from integrity – a lack of integrity in any dimension leaves an organization vulnerable to bad choices. #tChatSusan Mazza
A2: Leadership is not only responsibility, but Character. #TChatNissrine Ghannoum
A2: There’s a reason that shareholders vote on who gets to be in charge. #TChatMatt Charney
A2 Yes! Character influences behavior and culture. Trust built from that btwn clients/org fosters growth. #tchatEricka Lozano-Buhl
A2: Prospects buy from like minded culture vendors #tchatKane Frisby
Q3: What might character look like in the actions of positional leaders and others who choose to #lead through influence? #TChatSusan Mazza
Q3 – Leaders who listen & hear what rank and file say about workplace culture. If People are the drivers, they must have voice. #TChatJudy Martin
Q3 Good leadership comes in many forms but is easy to identify. Look not at the leader, but the level of motivation of the community #tchatValerie Merahn Simon
A3. Leaders as transformational forces, constantly engaging, motivating, encouraging others and self. #tchatMichael Clark
Q3: The actions of a leader are those that reflect the integrity of the organization. #tchatAndrae Rock Parker
A3: Assuming character. Positional leaders are present leaders and influential ones get the org where it should be tomorrow. #TChatJanis Stacy
A3 An honest character – admitting when mistakes are made and giving credit where it is due is essential in leadership.
A3: Consistent actions that align with values. #tchatJen Olney
Q4. How can leaders nurture and reward character in staff and other #leaders to have a positive impact? #TChatSusan Mazza
A4: The best reward is respect, trust and open communication. The “Golden Rule” applies to business as well. #tchatBeverly Davis
Q4: Lead by example and apply time for mentoring staff. #Leadership is both a trait & a skill so exemplifying it is teaching #tchatSunny Shao
A4 Values comprise part of our Vision statement. Leaders model the behaviors / “character” expected. #TchatRedge
@SusanMazza Q4. Gotta say this: you can be an egoic SOB and be great C level leader in large corp if you have enough business savvy. #tchatKent Osborne
A4 #leaders should ensure conditions for autonomy, mastery & purpose exist in their organizations. Best way to honor your ppl. #TChatBob Lehto
A4: Straight talk and social recognition. Everybody needs a deserved nod. #tchatKevin W. Grossman
A4 Our words matter little- but our actions reverberate in all areas. #leadership #character #tchatinTalent Consulting
Q5: How does good character underpin an org’s brand & affect how customers are treated? #TChatSusan Mazza
A5: In theory leaders character should align with corp values = brand, so will either amplify or destroy #tchatKirby Cole
Recognition is worth more than monetary rewards. Attention from a senior leader counts most. #TChatTranscend Coaching
Speaking as a resident of ILLINOIS we have learned that Leaders (w/o) character are bad & oftern go to jail #Tchat #Blog #Ryan (no relation)Dave Ryan, SPHR
We are drawn to natural leaders… fairn, high-integrity, motivational, character-based… leaders. #TChatMark Babbitt
Real leaders aren’t so wrapped up in being love with being a leader; they are more concerned about the ppl following. #tchatDawn Rasmussen
Lead with a beginner’s mindset – open, curious and free of prejudice. #tchat #leadershipVala Afshar
Leadership is a team sport. If you can’t play. get outta the way. #TChatDr. Janice Presser
Leadership is the confluence of service and courage. #tchatSalima Nathoo
The #character of leaders demonstrates to employee how to treat to others. Show your employees you embrace the #mission and #vision #tchatMichelle Z. Prohov
A5 If you look at offices/orgs with bad cust svc take a look at the leadership and I think you will find the reason #tchatGuy Davis
#tchat the only time a leader should look down at another team member is when they are offering them a hand up. #LeadershipBrad Wood
People wont follow if you lead in the wrong direction. Nor will they follow in the right direction if you lead them in the wrong way #tchatDavid Moore Ph.D
You can’t be a character-based leader if you lack strong character…if you have to, fake it ’till you make it :-) #tchatSheree Van Vreede
.@SocialMediaSean 100%! It’s amazing what you can learn from a great group of people #tChat #leadershipJobbook