It's a Value-Add.

Lucy Kellaway’s piece in today’s FT pillories the overt adoption of values by corporations, presenting as evidence of their worthlessness an interesting graph which implies that the share price of those companies “without values” outperform by c. 70% those that publicly proclaim values.

Much of what she says feels right: most employees can’t recall values so how can they be useful? Many ‘values’ should be universal or are so vanilla they are meaningless. Self-describing is always dodgy. The message is that they are not just corporate fluff – they might actually be detrimental to the success of a business.

But three things occurred to me while nodding my way through her column.

First, she states that three of the five people who, when asked, could recall the corporate values were “on the committees that drafted them”. The people on those committees are probably those with the power to make sure the organisation acts in alignment with them. How many CEOs would allow their Company to publish corporate values with which they disagree? Further, the support act in values-creation is usually the team that helps the business communicate effectively and ensures those values are applicable from top to bottom. These are the people who need to know them – everyone else just needs a sense of them: just because I can’t remember my exact bank balance doesn’t mean I don’t know roughly the amount by which I’m in credit, meaning that I know whether I should (or shouldn’t) buy a new car / clothes / woolly gloves (delete as appropriate). 20% of those Lucy asked could remember the values. I’d argue that this is all you need, as long as it’s the right 20%.

Second, I’m particularly interested in knowing which 17 of the FTSE100 “have no values at all – or at least none they care to disclose on their websites.” Is this because they understand that values are about giving employees internal, universal guidelines by which to make good decisions on a day to day basis rather than about external advertising? Showing the outside world through consistent behaviour how the organisation does business, rather than just throwing some words out there in public and getting back to making money?

Third, by now – post LIBOR, VW, BP, Tesco - it should be crystal clear to most that although financial returns are vital, they are no longer the only measure by which an organisation is judged. The methods by which good corporate citizenship can be determined are still evolving, but I’d bet that a few of those companies which don’t appear to have values believe it’s better to have none that can be brought as evidence against them when they – as shown in Lucy’s useful graph - make their +70% SP performance versus those without.

I know what our values are (be smart, transform, inspire) and I also control our corporate website, but you won’t find our values listed there. You will find them on our employee intranet. You will find them referenced in all the questions on our annual 360 degree feedback process, which helps people identify whether they are an effective ambassador for the Company. And you will find them as the basis of our simple guidance on expected corporate behaviour, which demonstrates how the umbrella values translate into situations that might be encountered every day at work and how behaviour that aligns to those values can help with career progression.

As a member of a company that has undergone a major turnaround (transformation) over the last three years, I know that if you want to empower employees to make the right decisions on their own every day, simple, meaningful values that act as a quick mental checklist (Is this smart? Is this transformational? Will this inspire?) can be immensely powerful. And yes, I was on the drafting committee.