The CFO’s Role in Company Culture

What culture are you creating and are you attracting the best talent?

‘...less than 3% of the most senior teams and organizations are aligned in their thinking about strategy, culture, and what we call the ‘X,’ and the ‘X’ is customer experience plus brand and its proper, truest essence.’?

Richard Nugent, Founder and MD, TwentyOne Leadership

There is no exact definition of company culture, but it is best described as the personality of your company, defining the environment in which your employees work and the ways in which they behave.

Most CEOs have a vision of the type of company culture they are looking to create, based upon your company’s purpose and mission. As the CFO, you have an important role to play in helping to create the company’s desired culture.

Here are eight types of company culture, each with obvious advantages and disadvantages:

Creating a strong company culture provides many benefits to your business, including great customer satisfaction, high productivity levels and increased employee retention. Your business culture has a huge impact on the behaviour of your workforce, their ability to thrive within their roles, and the overall reputation of your company.

Your company culture is based upon the foundation of shared values. CEOs will typically communicate their business values to employees during workforce presentations, team building sessions and induction training. These values need to be consistently backed up and enforced by every member of the leadership team, including the finance leader.

The modern-day CFO is a vital member of the leadership team and plays an increasingly important role towards driving their company’s culture.?

Psychologists estimate that the average employee only contributes 20% of their true potential, providing you with huge opportunities to uplift people’s impact.

There are many ways in which you can drive your company culture, including the following:

1. Employee packages: Calculate bonuses based on objectives linked to shared values.
2. Recruitment: Hire candidates that fit well into your desired culture.
3. Promotions: Place significant emphasis on certain types of behaviour.
4. Employee awards: Showcase individuals who demonstrate your desired values.
5. Business awards: Apply for awards that reflect your culture, such as high growth awards.
6. Leadership: Build a management team based upon your culture, with consistent messages.
7. KPIs: Monitor key metrics that are specific to your desired dominant culture.
8. Funding: Allocate funds towards activities that promote your culture, such as innovation.
9. Training activities: Provide education programs to cover your company values.
10. Reactions: The way you deal with a failure or crisis will drive values and impact culture.

The CFO’s Role in Aligning Strategy and Culture

In a podcast episode, Richard Nugent , Founder & MD, TwentyOne Leadership Ltd shared some tips on aligning company culture and strategy:

- Ensure the culture is shaped to be a strategic enabler for the organization's strategy and goals. The culture should help deliver the strategic objectives.

- Start with defining what the desired culture is and have clear alignment from leadership on what the end goal is for the culture change.

- Develop a robust business case for culture change, just like for other strategic initiatives, with clear metrics to measure success.

- Involve people across the organization in shaping the cultural elements like purpose, values and vision to increase alignment and buy-in.

- Ensure leadership models the new culture and puts their reputation behind it for the changes to take hold.

- Link culture to performance management and make behaving in line with culture an explicit part of people's objectives.

Listen to the Full episode here:

Interested in developing your leadership skills further?