Contributed by Aaron Fairchild, CEO of Green Canopy Inc.

According to 2013 research published by Luigi Guiso, Paolo Sapienza and Luigi Zingales, The Value of Corporate Culture, 85% of S&P 500 companies have at least one section of their website dedicated to -- what they call -- “corporate culture” i.e. principals and values that should inform the behavior of the firm’s employees. Values are important to promote and advertise on corporate websites and reports, because it is imperative for companies to manage their image. External stakeholders expect companies to have thought about their values and publicly acknowledge them. The act of creating and promoting values can help assure external and internal stakeholders that the company has a higher degree of integrity and is guided to conduct their business in a way that is consistent with and based on their stated values. 

Start with Intention

I recently spoke with the CEO of a publicly traded bank who was extremely proud of his employees for going through the process to create and document their values. They were, “developed by a group of really passionate employees that love this organization and only want the best for the bank, our employees and our customers.” Their guiding philosophy relating to their values are stated as, “Our Core Values encourage us to act in a manner that “wows” others and provide us with the opportunity to guide our actions that allow us to become who we want to be. We take pride in our Core Values and strive to live them each day.” This is an example that provides insight into great intentions and proactive leadership. However, when I asked him, “What does the bank do to ‘strive to live them each day’?” he floundered. Wasn’t it enough to go through the process to create their values and then promote them both externally and internally?

Learn from Employee Perception

This is a great place to start. But organizations that want to leverage the power of corporate culture to increase productivity and returns need to do more. 

The Guiso, et al. study also uncovered some additional, interesting facts regarding advertised values. Notably, the value most commonly exploited by the S&P 500 companies was “Innovation” followed by “Integrity” and “Respect”. When the researchers attempted “…to correlate the frequency and prominence of these values to measures of short and long term performance,” they “...fail[ed] to find any significant correlation.” Basically they found that advertised values are not a great indicator of corporate and employee performance. Perhaps that is because it is easy to state your values, so everyone does. 

Another point to note in the research is the concept of perceived value. The study found that if the employees of the company perceive management to have a high level of integrity, there was a positive correlation, and good outcomes in terms of higher productivity, profitability, and the ability of the company to attract talent. In other words it isn’t enough to create and promote values, they had to be perceived and held within the employee base of the organization.

Living Values

So how do we know if a company’s stated values are not just something that they claim to be true, but are indeed perceived and held by the employees of the company? 

A few clues to consider in your evaluation process: 

1. If the company has its values listed internally or in an orientation packet, but they do not advertise their stated values on their website, this would suggest a note of caution. Again, according to the research paper, 15% of all S&P 500 companies do not advertise values. If you don’t talk about your values or share them with outside stakeholders then it is hard to be held accountable to them. It may also indicate that their management wants to be authentic and doesn’t feel the need to advertise values, however it certainly begs inspection.

2. Does the firm, large or small, value their Human Resources Department or efforts. In small, start-up firms many times HR is valued lower than marketing. The commitment of the leadership to focus on their number ONE asset, their human resources, is indicative of their values. In larger companies, is the head of HR part of the Executive Suite? In other words how high up are Human Resources valued? If the head of HR is nowhere near the top of the company, this would indicate a gap and that the leadership of the firm does not have a high attribution to corporate values. 
   

3. Inquire how developed their internal recruiting processes are. If employees don’t want to recommend their friends to work at the company… something may be off.
   

4. Can an employee who has been at the company around one year tell you the values of the company? If the company is living their values, it should be easy and even exciting to share with others the shared sets of values at the firm.
   

5. Can managers and employees give examples of when others made decisions that aligned with the values of the firm? Clearly if no one can, I would question if their values are lip service.
   

6. Lastly, ask the vendors and customers of the firm what makes the company different from others in same field. If examples of what makes the firm different line up with their stated values, you can assume that their values are not just lip service and that the employee on the front lines is living the firm’s values. 
   

I am sure you can think of many more “sniff tests”. The fact that anyone can truth-test stated values should give employees, investors, and customers alike a leg up in identifying if a company is truly anchored by its values (which correlates to performance and profitability) or if their stated values are just the lip service of corporate collateral created in the back halls of the Marketing Department. 

"The more alive values are within a group the stronger the bond and the greater the resiliency of that group. It’s about so much more than happy hour beers."

Contributed by Aaron Fairchild, CEO of Green Canopy Inc.

Have you ever heard ANYONE say after coming back from Europe, “I had a great trip, but I just hope those Brits/Germans/French don’t lose their culture?” The very notion of a nation losing its culture seems silly. Sure cultures change, but they change over time. National cultural changes happen slowly and change is usually driven by a shock to the current way of life. 

For whatever reason, corporate culture doesn’t seem as “fixed” as national culture. Nations lose their leadership, have lots of turnover and people come and go all the time. And nations are influenced by other nations in ways that it is hard to imagine might happen in companies. So what makes company culture more susceptible to change? 

Fast Starts and System Shocks

I recently spoke with David Norris, CEO of MD Insider. We both agreed that companies tend to start-up rather quickly. People come together in the beginning more out of chemistry and shared excitement about the opportunity surrounding the product or idea. More often than not, they share a common national cultural framework so they already have a great basis to begin working together. They also have a shared language, and typically share the same historical perspective, political and economic frameworks (socialist, democratic, capitalist, parliamentarian), etc. Layer chemistry on top of a similar national cultural framework, and that can take the newly formed company down the road a fair bit.

The breakdown typically comes, just like with a nation, with a shock to the system. For a company this could mean jumping from four employees to twenty in less than one year, and then from twenty to forty in another six months.  When countries are merged together for one reason or another, we often watch as the individual cultures tear them back apart... Infighting can happen as larger and more powerful countries begin to dictate terms. Just bringing a similar currency to Europe has been challenging since adoption of the Euro. In the same way, with companies experiencing rapid growth, bigger personalities typically dictate cultural norms, and when those personalities move, for good or bad, so goes the cultural dictator.

Core Values As Cultural Seeds

To help ensure your corporate culture isn’t encapsulated and controlled in one or two, or even just a few key personalities, consider what is at its core. Culture can be defined as the shared values, language, beliefs, and customs of a group. At the heart of culture is how we interact and behave together. At the heart of culture is how we interact together and behave together… David referred to our shared set of core values as the seeds of culture. As the seeds of culture take root in your workplace, your teams will thrive and productivity will increase. 

If a group of people has a shared set of values, they can be pointed toward any mission or vision, and as long as they buy into the mission and vision, they will excel.  Core values incorporate our language, what we celebrate, how we develop, our rights of passage, and how we interact. For a country, these things may seem obvious. For companies, it seems less than obvious for many leaders.  In fact, I’ve heard more about the importance of the boss taking people out for beer as a means to “create culture”, than working on our values to create culture. Hmmm.

Whether a company’s values are implicit or explicit, they exist. The more explicit the shared sets of values, the more that group of people “live” their values. The more alive values are within a group the stronger the bond and the greater the resiliency of that group. It’s about so much more than happy hour beers.

Every Day Values

Companies often explicitly state their values on their websites and in promotional material, creating a veneer of credibility and sincerity. One of the most infamous examples of this is Enron’s four capital V Values: Respect, Integrity, Communication and Excellence. Clearly this broke down long before the company failed. So if our values are the seeds of culture then nurturing and cultivating these values throughout every day will help to keep them alive and healthy, rather than stale and static on a corporate website.

For a traveler, there’s a difference between that sense of “Love this place, but wouldn’t want to live here” and “I would love to live here!” It’s the same in companies. Living your corporate values and keeping them alive and healthy within the company means the right people will find they’d “love to work here”, and the “wrong” people will move along. A company whose employees work to keep their shared values alive within the organization will allow the company culture and the team to thrive through down times and times of change and growth.

"If we don't pay attention, we risk running businesses at the expense of our communities, our planet and the future." 

Contributed by Krystal Meiners

It’s been nearly one year since Green Canopy became a certified B Corp. Our company, at that time, was a small and tight-knit group that was dedicated to living out our values and our mission. Our work was meaningful and the team was excited about growth.

It couldn’t have been a better decision to certify at that time. Our small and nimble team had created a rich corporate culture that everyone was excited about preserving. We were mindfully crafting systems for hiring, communication, and human resources that would ensure that our culture and values were protected as we grew. Certifying* was part of that process… but one year later we are finally seeing just how important it was.

Since then, Green Canopy has nearly doubled in size. We have started new business channels: from Fund development, to Custom Services, to RePurpose (a whole-house deconstruction program). We have gained talent, we have restructured; we have evolved. All the while, managing our culture, resources and social capital in a way that is intentional and meaningful. 

B Corp means a lot more to how we do business now. It enables us to do business the way we want to do business – the way we started out with our high-fiving, adventure-loving, sustainability-minded (Fbomb-dropping) nimble team not long ago. But now it allows us to do more. It holds us accountable, it guides us and gives us tools for growth. B Corp helps us do business better.

I asked some of our team, both new and old members, what B Corp means to them and how it allows them to do business better. Here is what they had to say:

• Ami Nieto, Office Manager: B Corp certification has fueled our passion for sustainability and keeps it at the forefront of our minds in every business decision we make. It has changed the way we hire people and tuned our focus on attracting talent that is committed to our mission as a Certified B Corporation. B Corp inspired us to raise the minimum wage of our company to $15/hour. For being a company of less than 50 employees, this change is years ahead of other companies in our region and our industry.  We now offer stock options to all employees upon hire. We also contract with more local and sustainable suppliers. We have chosen to bank locally with an independent institution (Beneficial State Bank). Next year we hope to go completely paperless!

• Bec Chapin, Director of Custom Construction: Being a B Corp takes the mission of Green Canopy out of the house and into the lives and operations of the company. It is about running business so that it is sustainable to the world, communities, and employees; and because of that, our clients. For too long we have run business for the benefit of the shareholders and forgotten that it is also a big part of the ecosystem of our lives. If we don't pay attention, we risk running businesses at the expense of our communities, our planet and the future. 

• Caitlin Hoeberlein, (Spec Construction) Project Engineer: I specifically sought out B Corporations when searching for job opportunities in Seattle. Previously, I worked for a small B Corp in New York, and I loved the attitude of people and the environment over profits. It was important to me that the company I worked for also supported those ideals that are so important to me.

• Andy Woverton, Controller and Director of Fund Development: Being a B Corp is important to me because it is an important signal of how Green Canopy cares about our employees, responds to the communities in which we build, provides information to our shareholders and stewards our environment. The B Corp signal projects positively to current and potential future employees, neighbors and investors.

• Nate Morr, RePurpose Site Supervisor: Being a B Corporation is important to the deconstruction work I am doing for the company because it allows me to be creative in the reuse/recycle of materials from the homes we deconstruct. Rather than solely being focused on the most efficient and economical method of material diversion, I can find unique ways of repurposing material that is beneficial to the environment, our community, and our company’s practices as well. For instance, having the Union Gospel Mission's 118 Design Program work with us to deconstruct and reuse reclaimed lumber is an excellent story for the diversion of our material that, once we streamline our processes, could be extremely efficient and economical while being 100% mission-aligned.

• Sam Lai, CMO: I love that Green Canopy is a certified B Corp. Most home buyers today are still indifferent to energy efficiency in homes, but when someone buys a Green Canopy home, their super-low utility bill and amazing year-round comfort becomes an undeniable benefit to the homeowner. However, the societal benefits are less tangible. B Corp's rigorous environmental and social standards help to communicate how our homes are also better for communities and our environment. 

Each member of the team finds the B Corp certification meaningful for their own reasons, but putting some structure and accountability around those values strengthens our community and purpose. In the year since we certified, we have improved in all areas of our business and are currently working on a Corporate Social Responsibility Framework. This framework will help us develop a set of action-oriented goals for improvement, as well as help us improve our reporting and the measure of our impact. The steps we are taking, including even just revisiting team commitment to it through writing this post, help us collectively see the change and be all  the more intentional about B-ing the change.

* A B Corp is a for-profit company that is committed to gains in social and environmental capital rather than just monetary profits. It is a certification that is awarded by B Lab in Pennsylvania – an organization that scores companies based on a set of social and environmental metrics. Green Canopy’s score at certification was an 86.