Corporate culture was under the microscope at the Australian Council of Superannuation Investors Annual Conference in Sydney last week, when a panel of the industry’s leaders said it needed a greater focus on organisational culture and governance.
Nicola Wakefield Evans, a non-executive director at Lendlease, Macquarie Group, Macquarie Bank and BUPA, said, given the headlines from the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, boards must broaden their experience and diversity to better influence the behaviour of their businesses.
“You can be going along thinking your company is fine and then be hit by something out of the ordinary,” Wakefield Evans said. “I think recent events need to be a wake-up call to every director on any board, particularly bigger ones.”
Independent non-executive chair at Super Retail Group Sally Pitkin said culture and ethics were important to the foundation of every organisation and should be considered within the specific context of each business.
“For me, what’s come out of the royal commission is that I want us as an organisation to go back to those foundational elements of culture and ethics – you want them to be effective and to achieve their purpose,” Pitkin said. “Both of these things are complex and difficult to change if you need to change them. Culture is difficult to change because it’s all about how people in an organisation have been doing things, sometimes for a very long period of time. The reason they do it that way is because that’s what’s been effective in the past.
“And with ethics, research shows us that people have a lower moral compass in a work environment than they do personally. There’s a complex interplay between how they are at work and how they respond. So those two things [culture and ethics] have got to infuse everything we do.”
Chairman of Ardent Leisure Group Dr Gary Weiss said some of the [poor] behaviour that had been demonstrated in recent times went right back to company incentive structures and leadership behaviour.
“A strong leadership team must raise not just the concept of compliance but also the spirit of compliance,” Weiss said. “You need to embrace compliance as a worthy and deserving goal in its own right.”