A healthy corporate culture lies at the heart of strong corporate governance. Corporate culture can be defined as the values, attitudes and behaviours demonstrated by the issuer in its operations and relations with its stakeholders. An effective Board sets the tone at the top and defines the issuer’s purpose, values and strategy and shapes and develops the desired culture to support the issuer’s ambitions.
Shaping and maintaining the desired culture is a journey, and requires long-term commitment from the Board. The Board should monitor and evaluate corporate culture and pay attention to hints of potential cultural weaknesses, such as a high rate of staff turnover and a low level of communication / engagement and a lack of transparency within the issuer.