Measuring
ethical culture
According to the Financial Reporting Council, poor culture is a business risk in itself. Boards are therefore advised to “seek assurances about the health of the culture by taking the temperature of the organisation on a regular basis”.
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What we do
GoodCorporation has developed an Ethical Culture Health-check to provide an assessment of corporate culture that can be benchmarked for use in internal and external reports.
This helps organisations meet the requirements of the 2018 UK Corporate Governance Code that boards should assess and monitor culture. As the Code states, where it is not satisfied that policy, practices or behaviour throughout the business are aligned with the company’s purpose, values and strategy, the board should seek assurance that management has taken corrective action. The annual report should explain the board’s activities and any action taken.
This means gathering evidence by monitoring chosen indicators to gain insights into the overall culture. Qualitative and quantitative data should be gathered and analysed annually to enable boards to demonstrate that its corporate culture is aligned with company purpose, strategy and values. This can be done using GoodCorporation’s Ethical Culture Heath-check.
Ten key drivers of an
ethical corporate culture
GoodCorporation has identified the ten key drivers which should underpin the culture of any ethical company and form the basis of our ethical culture health check. The prevalence of these drivers can be measured within any organisation using GoodCorporation’s assessment methodology.
Strong ethical tone from the top
Employees treated fairly
Personal development taken seriously
Management trusted to do the right thing
Employees supported to do the right thing
Confidence in raising concerns
Health and safety taken seriously
Customers treated fairly
Suppliers treated fairly
Environment and local community respected
GoodCorporation
ethical culture healthcheck
To help organisations comply with the increasing expectations and regulations around the management of culture, GoodCorporation has distilled over 25 years of experience conducting business ethics assessments around the globe into an ethical ‘health check’ of company culture.
The health check can be set up as a standalone assessment of a company’s culture at any given site or range of sites using the following methodology to produce both quantitative and qualitative results.
Sample selection
- GoodCorporation independently selects a sample of employees which reflects the organisation as a whole
- Interviews are scheduled over a one- to two-week period
The interviews
- Interviewees fill out a questionnaire at the beginning of their interview, responding to the 25 supporting statements: strongly agree to strongly disagree
- Interviewers then explore the completed questionnaire in-depth by asking interviewees to explain the rationale behind their most notable responses
Analysis and reports
- The questionnaire results provide quantitative scores for each driver and statement
- A net score is calculated, by subtracting negative from positive results
- The organisation’s net score can be benchmarked against the national average
- A detailed report is written combining the quantitative and qualitative results
Bespoke culture assessment
Aspects of the healthcheck methodology can be tailored to supplement a company’s existing
efforts in the area of culture measurement, for example by:
Distributing the key statements indicative of an ethical culture to a wider representative sample of employees, to function as an initial standalone culture survey
Providing interview-driven “deep dive” assessments of a company’s ethical culture in selected locations, to contextualise the findings of existing survey data
Helping companies to develop and implement an action plan for cultural improvement on the basis of existing survey or interview data
Our healthcheck methodology can therefore be used to help companies at any stage in their measurement and development of an ethical corporate culture, from initial assessment through to the implementation of improvement measures, giving boards the metrics they need to report on culture and managers the tools they need to enhance it.
GoodCorporation has a thorough understanding of how to measure ethical business conduct and to build this into the audit process. Analysing ethical business conduct and non-financial risk is a challenge for many businesses and we are very pleased that we have been able to take such a leading position through our work with GoodCorporation.
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