Consensus from experts is that organisational cultural change has to come from the top, making the decisions of some major financial services groups to replace executives with people already deeply ingrained in the industry in the wake of the Royal Commission seem questionable.
Live polling at the talk revealed that culture was a hot topic amongst superannuation funds at the moment, with 70 per cent of delegates saying that culture had greater influence on their funds now than two years ago and 20 per cent saying that it was unchanged.
Professor of marketing at the Melbourne Business and Medical Schools, Jill Klein, today told delegates at the Conference of Major Superannuation Funds that it was very hard to change an organisation’s culture from the bottom up.
Professor Graeme Samuel of Monash University, and former Australian Competition and Consumer Commission (ACCC) chair, backed this up: “Change must start at the top. It must be a visible tone from a visible CEO and a visible board.”
Expanding on this, president of Northern Trust Asset Management, Shundrawn Thomas, said that change from the top required three things. “You need strong and effective leadership making these signals, engaged employees that actually care about the welfare, wellbeing and reputation of the organisation, and effective governance, [which] is more than just having a good economic end, but making sure you have those first two things.”
While this doesn’t necessarily need to involve changes in leadership, Thomas thought it unlikely that large scale change could be achieved without it.
In terms of creating that change, Thomas and Samuels urged delegates not to give their money to consultants to transform their cultures.
“You don’t need a group of consultants swarming over your organisation and saying that they have the solutions. Because that’s the consultants’ solution,” Samuel said. “But leadership should come from the top and if you’re the CEO or chair of an organisation and you don’t know what its culture should be [yourself], then you need to question if you’re the right person to be leading that organisation.”
Klein recommended that organisation go to their biggest stakeholders and ask how they perceive the culture of the organisation, noting both that there can be a “big gap” between the culture of a business and how others perceive that and that those within its management can have blind spots.
She warned however, that organisations should be aware that cultural change wouldn’t necessarily happen overnight: “[How long it takes] really depends. It can take forever, it can be never. I’ve seen organisations where they’ve had a number of tries and nothing has worked and then it’s happened very quickly.”