CECP Joins NACD in Call to Board of Directors to Elevate Dialogue on Corporate Culture
Purpose-driven corporate culture can facilitate efforts to achieve long-term organizational goals
NEW YORK, October 11, 2017 /3BL Media/ - CECP: The CEO Force for Good is echoing a call made by the National Association of Corporate Directors (NACD) for boards of directors to take a proactive approach in overseeing company culture. The NACD noted that culture is a means to driving sustained success and long-term value creation in its recent publication The Report of the NACD Blue Ribbon Commission on Culture as a Corporate Asset.
“Leadership is about establishing a long-term vision and setting a course to achieve it,” said CECP CEO Daryl Brewster, who also served on The NACD 2017 Blue Ribbon Commission that issued the report. “We have read the headlines about companies whose culture is driving business performance and those whose culture is destroying value. The insights in this report make it clear that today’s Directors must understand and engage in a company’s culture.”
Organizations with strong, positive cultures have been shown to outperform their peers whereas the absence of a healthy culture can create or exacerbate significant risks. Yet in a recent NACD survey, less than half of directors reported that their boards assess the alignment between the company’s purpose and values and its strategy, and only 50 percent say they understand the “buzz at the bottom”—the collective behaviors, norms, and values at the front lines of their organizations, among their rank-and-file employees.
The 2017 NACD Blue Ribbon Commission aims to change these statistics by calling on boards of all sizes and from all sectors to apply the same leading-edge risk-oversight practices to culture oversight as they would to the management of any other risk they oversee. The Commission counts more than 30 experienced directors and leading governance professionals among its membership.
“Having a healthy, resilient culture is essential if companies want to be able to adapt to new business dynamics and competitive challenges,” said NACD CEO Peter Gleason. “Simply put, healthy cultures pay off. NACD’s Blue Ribbon Commission Reports have set the standard for effective boardroom practice for two decades. Our goal this year is to offer boards practical guidance and tools to help their organizations harness the power of culture as a competitive differentiator.”
The 2017 NACD Blue Ribbon Commission report contains recommendations and specific action steps board members can take to elevate culture-oversight practices in key areas including CEO selection and evaluation; executive compensation design; discussions with management about strategy, risk, and performance; and assessing culture inside the boardroom. The report’s toolkit includes materials all boards can use to benchmark their current practices and implement improvements, including:
- Boardroom discussion guides with specific questions on a range of culture-related topics
- Guidelines for developing board-level culture metrics and reporting
- “Red flags” that indicate potential breakdowns in culture
- Templates for board-member guiding principles and director codes of conduct
- Examples of culture survey questions and board disclosures
The 2017 Report of the NACD Blue Ribbon Commission on Culture as a Corporate Asset and the comprehensive toolkit (available exclusively to NACD members) can be accessed at https://www.nacdonline.org/culture.
The report’s Commissioners comprise distinguished corporate directors and governance experts. In aggregate, they serve on the boards of 48 publicly traded and 28 privately held companies, and on 25 nonproﬁt-organization boards. The Commission includes 11 current and former CEOs.
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The National Association of Corporate Directors (NACD) empowers more than 17,000 directors to lead with confidence in the boardroom. As the recognized authority on leading boardroom practices, NACD helps boards strengthen investor trust and public confidence by ensuring that today’s directors are well prepared for tomorrow’s challenges. World-class boards join NACD to elevate performance, gain foresight, and instill confidence. Fostering collaboration among directors, investors, and corporate governance stakeholders, NACD has been setting the standard for responsible board leadership for 40 years. To learn more about NACD, visit www.NACDonline.org.
ABOUT CECP: THE CEO FORCE FOR GOOD
CECP is a CEO-led coalition that believes that a company’s social strategy—how it engages with key stakeholders including employees, communities, customers, and investors—determines company success. Founded in 1999 by actor and philanthropist Paul Newman to create a better world through business, CECP has grown to a movement of more than 200 of the world’s largest companies that represent $7 trillion in revenues, $18.6 billion in societal investment, 13 million employees, and $15 trillion in assets under management. CECP helps companies transform their social strategy by providing customized connections and networking, counsel and support, benchmarking and trends, and awareness building and recognition. http://cecp.co