What governance arrangements and leadership actions embed a culture of respect for people?
It is often said that “culture eats strategy for breakfast”. And we regularly hear that the “tone at the top” of companies has a central role in defining day-to-day actions and behaviors in the workplace. But when investors, regulators and other stakeholders want to judge if a company is well constituted to achieve responsible conduct, the focus tends to be solely on whether formal governance structures are in place. This ignores one of the most important functions of company leadership and governance: to go beyond setting out what people in an organization are supposed to do, and to look at what actually happens. In other words, to focus on the role of leaders in shaping organizational culture.
Our Leadership and Governance work is seeking to address this by identifying a menu of indicators that marry together insights into both formal governance structures and leadership behavior. Used in combination, these indicators should help people see whether, and to what extent, a culture of respect for human rights is embedded within a company.
“It is hard to confront organizational incoherence, show empathy for people we don’t know, build a mindset of shared responsibility and learn openly from mistakes. But these practices are critical to building a business culture that respects human rights. So we are looking not just at the governance arrangements leaders put in place to guide responsible behavior, but also at what leaders do to model those behaviors themselves.”MARK HODGE, CO-LEAD OF VALUING RESPECT
Leadership and governance indicators
In 2018, we looked into what we can learn from research into governance and culture in the areas of health and safety, diversity and business integrity. We also reflected on features of corporate culture that are especially critical to embedding respect for human rights in a company. Our research identified four such features around which we have developed an initial set of draft indicators. They are:
- The Authenticity of Commitment: the organization acts in a manner consistent with its publicly asserted commitment, including when faced with inevitable tensions between respect for human rights and other business goals.
- Responsibility and accountability: respect for human rights is embraced as the responsibility of people in every part of the business, and key staff are empowered and motivated to embed respect for human rights across the company.
- Respect and empathy: everyone in the organization is motivated to know and care about whether and how it might be involved with harm to the human rights of people, including to remote individuals and communities.
- Organizational Learning: the organization seeks out and embraces new insights about human rights risks and makes an effort to learn from its mistakes as well as successes.
The indicators are intended as a menu from which organizations can draw as appropriate. Yet they will be most robust when used in careful combinations. We are developing some supporting materials to assist in their application.
We will continue to refine these indicators and to work with partners to pilot different use cases in order to further strengthen them based on what we learn.
Research and Outputs on Leadership, Governance, & Culture
Leadership & Governance Indicators of a Rights-Respecting Culture (BETA)
The primary intended users of this resource are: Business leaders seeking to assess the strengths and weaknesses of their company leadership, governance and culture with regards to respect for human rights; Investors and civil society organizations seeking to strengthen their analysis, strategies and engagement with companies regarding progress towards respect for human rights.
Rights-Respecting Corporate Culture: Cultural Norms & Values that Underpin Business Respect for Human Rights
This piece examines corporate culture, identifying the key elements that make a rights-respecting culture successful.
Developing Leadership & Governance Indicators
Viewing the Valuing Respect Project through the Lagging v. Leading Indicator Lens
In this piece, Shift’s Senior Advisor John Sherman discusses the usefulness of lagging versus leading indicators in how we evaluate business respect for human rights, and what the future of these indicators might look like through the lens of Valuing Respect’s mission.