How Corporate Values Translate Into Value at the Bottom Line

Ninety-five percent of companies believe that living their corporate values pays off economically, according to a survey among the top 150 companies in Germany, Austria, and Switzerland conducted by Booz Allen Hamilton; seventy-six percent of companies expect values to play an increasingly importance role in the future.

"A value culture can only take root and thrive at a company if senior management lives it," explained Munich-based Booz Allen Senior Associate Jeno Schadrack. "If the leaders don't show that they believe in it — the ethics system won't be successful." It also takes time to establish a value culture. "If you have a high fluctuation of CEOs or of other senior leadership, which is more often the case, it gets harder and harder to establish that culture," he said.

Embracing Your Corporate Value Agenda

Customer service, quality, responsibility, professionalism, excellence, and trust were cited as the most relevant values in a company's day-to-day business, while shareholder value was given a lower ranking. "The majority of companies reported that they do 'live and breathe' their corporate value agenda," said Schadrack. "And the majority said that their top management has rejected business opportunities that were not in line with their code of ethics."

A value culture can benefit a company in many ways — including enhancing their public image while maximizing profits, limiting business risks, and facilitating internal cooperation and communication. Customers, the news media, and the general public are considered the most powerful drivers of a company's value agenda compared to supervisory boards and shareholders, which are viewed as less influential.

Next Steps

Despite the positive outcomes reported, nearly 40 percent of companies stated they would appreciate a change in their corporate values to make them more stringent. The survey also revealed that corporate values are currently only selectively tracked via "hard" measurement tools and 50 percent of companies believe those tools should be improved. Additionally, "the CEO, together with the other top managers, have to be the role model for making that change happen," according to Schadrack, "governance rules alone cannot fulfill this function."

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Booz Allen Vice Presidents Gregor Vogelsang, Christian Burger, Rolf Habbel, and Klaus-Peter Gushurst also contributed to this study.