Annually there is a general ‘Director Update’, the 2016 version is currently rolling out, and I attended in Sydney last week.
Amongst the items of interest, one particularly took my attention. The emerging focus on ‘Culture‘, has belatedly come onto the radar because the legislators are beginning to use the word.
This begs the question of how you define ‘Culture’, certainly those in Canberra writing the rules have no idea, despite setting out to legislate for it. It is a bit like legislating for ‘Motherhood’. Everyone agrees it would be great to have it, successful people have benefited from it, but definition is a bit tricky.
“Culture eats strategy for breakfast” is now a commonly used phrase, shortened from the original by Peter Drucker who wrote: ‘Culture eats strategy for breakfast, technology for lunch, and products for dinner, and soon thereafter, everything else too’
Lou Gerstners view expressed in his terrific insiders view of the turnaround of IBM “I came to see in my time at IBM that culture isn’t just one aspect of the game – it is the game. In the end an organization is nothing more than the collective capacity of its people to create value.”
Building a positive culture depends on leadership, not regulation. Absolutely not regulation.
This remarkable TED talk by Simon Sinek is talking about leadership and the culture good leadership builds. I think anyone in authority should watch it and absorb the message, and set about trying to articulate what it means in their context.
ASIC (Australian Securities & Investments Commission) Chairman Greg Medcraft in his speech opening the 2016 ASIC Annual forum failed to give any hint about the definitional questions around Culture, simply pointing out that it led to good commercial and social outcomes. He did add that “We are incorporating culture into our risk based surveillance reviews’ which is terrific but it would be nice to know how one of the key regulators is going to measure it. Back to the politicians?
On occasion I have been critical of the AICD for its focus on the compliance issues of listed companies and their directors, often seen as the ‘big end’ of town. This focus is not unreasonable given that every organisation has to focus on what is seen as the main game in one way or another. However, it does tend to marginalise the unlisted and family company block which constitutes the vast majority of enterprises, and the overwhelming majority of those in the role of ‘Director’ often without knowing anything about the fiduciary responsibility that goes with it.
However, in this case, starting to talk about Culture, the Institute has kicked over a rock that requires a lot of consideration and debate, so well done.
I look forward to that conversation.
Credit: Thanks once again to Hugh McLeod for the inspired cartoon.
