As the primary survey administrator and data analyst behind Ethisphere’s Ethical Culture and Perceptions Assessment, Scott Stevenson has now spent years with his finger on the cultural pulse of companies of nearly every imaginable size, industry, geography, and maturity. Now that the survey data set has passed 630,000 respondents representing the view of more than five million employees around the world, Ethisphere Magazine decided to sit down with Stevenson to glean some of what he’s learned.
Ethisphere Magazine: First, can you explain just a bit about the thinking and methodology behind Ethisphere’s Ethical Culture and Perceptions Assessment?
Scott Stevenson: Absolutely. As companies have begun to realize that culture is an incredibly valuable, if intangible, asset to performance, executives and boards have begun looking for ways to measure it. Although companies can get some culture data from normal employee engagement surveys, best practice has companies performing standalone ethical culture surveys to do a deep dive on the topic at least once every two years.
Ethisphere’s Ethical Culture and Perceptions Assessment is structured around Ethisphere’s Eight Pillars of Ethical Culture, with sets of questions designed to determine how a company is performing among such factors as awareness of resources, how much pressure employees feel, or their perceptions of organizational justice.
EM: So companies run a survey with you, and then the results come to you for analysis. What does that process look like?
SS: Depending on the company, we may have surveyed all or some portion of their workforce spread around the world. We strongly encourage companies to maintain our same basic survey structure, which allows me then to benchmark an individual company against our entire data set of responses, which at this point is over 630,000 employees worldwide who have taken the survey. That gives us an extremely robust benchmark. I then begin diving into the data to see where companies may have performed particularly well or particularly poorly.
EM: How granular can your analysis go?
SS: Assuming the company has chosen to survey a large enough percentage of their workforce for us to have significant sample sizes, we can go quite deep. One of the most valuable things that I can do for companies is to segment the culture data in two ways: by location, and by business unit.
Location segmentation is especially valuable because it gives insight into how, for example, regional cultural variation might be impacting employee perceptions, or delaying implementation of an organization’s practices in a certain market. For example, certain countries in the Asia Pacific region have more hierarchical cultures, which then show up in the data on organizational culture—employees might feel less able to “speak up” to contradict or question a superior there without explicit training to do so. This problem could also manifest as employees reporting above-average pressure in certain countries or regions, simply because their managers may not be discussing ethical conduct as often as hitting goals.
Business unit segmentation can also be valuable, and oftentimes it’s actually useful for highlighting areas of good ethical performance. If certain units score particularly well against our benchmarks, their managers might have attitudes or practices that can, via peer-to-peer exchange, be shared throughout the entire organization.
EM: So companies get their results back, and you walk them through how they’ve assessed against your benchmarks, and any observations you have when you segment the data. How do they then use those results? What are the next steps?
SS: On some level, next steps depend on what areas for improvement we identified in the data, and we can work with different Ethisphere experts to develop action plans. For most companies, the data points to some kind of gap that can be addressed via a communication and education plan. Companies may need to target certain markets, or all employees, with new or better information about policies, procedures, or resources. However, the segmentation we discussed earlier also gives companies the tools to build communication plans targeted to specific regions, or that leverage certain business leaders—for example, if your sales function is having issues, it’s prudent to enlist your sales executives to help address them.
Assessment results can also help companies to identify areas of opportunity to work into their audit plans. If perceptions of organizational justice are particularly low in certain markets, it’s probably worthwhile to go back and revisit some disciplinary and investigative outcomes from those markets, or to look at the way investigators communicate with reporters after a matter is closed.
EM: Aside from the analysis you do with the raw data on its own, do companies use the data in other ways?
SS: Absolutely. For companies with the right capabilities, culture survey data can be even more valuable when paired with other data lakes at the organization.
Maybe the most obvious application is as a risk monitoring tool. Poor culture scores, especially those around observed misconduct and willingness to speak up, are a blinking red light for fraud, corruption, and reputational risk. Areas of the business where a speak up culture has eroded should be top priorities for risk mitigation.
One of the most common use cases is to overlay culture data with case management data. Companies can then see if, for example, there are regions or functions where employees report higher levels of observed misconduct in culture results, but those matters do not “reach” the case management system. In that case, it’s likely that either misconduct is being ignored, or managers are electing to handle issues themselves without escalating them appropriately. It may also be that employees simply don’t report because they fear retaliation. In either case, companies can then take proper steps to address the problem.
Another useful data pairing is to look at culture data in conjunction with human resources performance appraisals. Generally speaking, I don’t recommend that companies use poor culture data as a stick, or reason to punish managers whose units don’t perform as well. However, culture metrics make great “carrots” to identify and reward top-performing managers for how well they demonstrate and uphold the organization’s principles or purpose. Best practices from those individuals can then be disseminated to the rest of the organization.
EM: Well Scott, thanks so much for your time.
About the Expert:
Scott Stevenson is a senior analyst as part of the Data & Services group at Ethisphere. In his role with Data & Services, Scott supports the various efforts that help organizations assess their ethics and compliance programs and their corporate culture. He previously helped multi-national organizations develop and maintain their corporate compliance training programs as a Client Service Lead at NYSE Governance Services.