Seminar 2 Write-up:

“Corporate values as support and hindrance for decision and action”

For decades, corporate goals were to focus on profitable results. But in this ever-fast evolving
era, business trends and practices are transforming from increasing shareholder value to
utilitarianism. Traditionally competitive advantage was all about innovation and operational
models but now the aspirations are shifted to a deontological approach (corporate values) –
sustainability through behavior, governance, and responsibilities. Companies are going through
challenges like uncertainties, diversity, racial abuse, climate issues, workplace issues, and so
on. Stakeholder concerns arose the need for organizations to effectively communicate
corporate values to build the productive perception among beneficiaries than just buzzwords.
Organization's perspectives are changing from self-centered to a more socio-global view.

When talking about organizational values, it refers to a firm’s strategic vision for stakeholders
like people, society, and businesses. Organizations are like human bodies. Thoughts and
behaviors of people drive the organizations. Understanding organizations requires an
understanding of behavioral emotions and motivations. Values set out the principles which an
organization will hold by no matter what. Values reflect human behaviors and are effective
when culture is strong, consistent, and clearly articulated. Emotional and risk factors influence
what a company is saying and what they are doing. While developing the organization values,
emotions, and motivations (anger, fear, appraisal, trust) affect the decision-making process
within an organization. Organizational values are more aligned to goals when the leaders and
people inside the organization have good control, engagement, loyalty, and shared
understandings. Mckinsey 7s framework helps the manager not only in identify the
organization’s structural values (hard side- structure, strategy, and systems) and human values
(soft side- skills, staff, style, and shared values) but also align the cross-functional teams and
processes. Values can be categorized in ‘Who we are” (Character values), “how we work”
(Professional values), and our stakeholders (Stakeholder values). According to The AMO
research survey, 2300 individual values are identified by organizations all around the globe but
people & community, ethics & integrity, and creativity & innovations are the values where
companies are putting more effort to reflect the role as responsible in markets. It is also crucial
for a company to make differentiate between core values, aspirational values, and accidental
values. It shows how serious and transparent the company is about taking its ambitions into
action. Choosing the values demands a company, team, and individuals to tradeoff between
want-self and should-self, as well as a choice between present and future benefits (concept of
economic discounting).

As mentioned, Hundreds of corporate values are identified in The Amo research survey. Each
holds importance in organizational culture, and at the same time, it can have a negative impact.
Let us discuss how it can influence an organization positively and negatively.

The one that has more impact on today’s business success is ethics & integrity. The ethical
and integrity value of an organization creates a set of positive principles for a firm which are
honesty, transparency, and morality as well as dominating practices, operations, decision-
making procedures, and results within a given environment. In simple words, integrity and
ethical values mean that individuals, entities, or governments act in accordance with a set of
values and principles that are recognized by the majority. This includes honesty, justice,
transparency, fairness, trust, and respect. The core trait of this ethical value is that it encourages
transparent communication between stakeholders, focuses on a process-oriented approach
than a result-oriented approach. Cognitive moral development in an organization allows
ethical decision-making and certainly eliminates ethical dilemmas (mood consistent
judgment and regretful emotions). As highlighted in Ashkanasy’s integrating emotions and
affect theory management, ethical context/ ethical perception allows companies to make
decisions that are according to the moral values of society, and it helps to avoid biased
decisions. Customer loyalty is also interconnected with the ethics and integrity of business
operations. Today customers are more concerned about how businesses demonstrate the effort
of ethical practices than products themself. Companies behaving ethically make customers feel
proud that they have made a good decision to work/trade with the company. The primary
purpose of businesses is an increase in shareholders' value, the more the business exhibits its
practices aligned to ethical conduct more it attracts the investments and supply chain
partners (suppliers & distributors) with a positive reputation in the market integrity has a
significant impact on employees. From a collective perspective, ethical leadership increases
the team’s moral by motivating, inspiring, and allowing employees to feel accountable.
Fairness and respect within team members allow employees to come with more productivity
and inspiring ideas. Finally, integrity allows organizations to be more integrated which
prepares individuals to deal with protentional uncertainties and risks.

However, wrong choice of organization’s value that do not align with culture and
understanding may create negative impact on performance and future growth. I would like to
criticize Professionalism & Discipline. A strong professionalism & disciplined corporate
value can have pessimistic impact on organitional culture.

Professionalism is about acting in accordance with predefined norms of processional behaviors,

responsibilities, and customs. Professionalism is considered a positive trait for people and
processes in a workplace. But I believe excellence in professional disciple limits creativity. It
makes systems rigid and complex that employees lack to produce innovative ideas. AMO
survey shows that one-third of companies are investing in making their culture more
professional but at the same time a high standard of professionalism comes with huge sunk
costs. training and development of talent cost a company more. Adherence to a disciplined of
values many feel uncomfortable and observe behavioral changes. They often feel stressed,
pressured, and have difficulty in decision making. Social functioning of the emotional
complexity is difficult in highly professional companies.

The crux is emotional and behavioral cognition can change the organization’s workplace
culture which affects the decision-making power. It is especially important to decide how
organizations want to operate and how they want to be perceived in the market.