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      October 2005
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Corporate values

By Murray Wolfe
Illustration: Cathy Pentland

Meaning-based management can help a company retain a human face and become a place where people want to work

 

As a result of his personal experience in the Second World War, in which everything he had except for his life was taken from him, Viktor Frankl, a Jewish psychologist, realized the most important motivator of every human being was the personal search for meaning. Based on this philosophy, Frankl went on to found his own branch of psychology and named it logotherapy, derived from the Greek word “logos,” or meaning.

Put simply, logotherapy is based on the philosophy that “man’s search for meaning is the primary motivation in his life.” Frankl referred to this motivation as the “will to meaning,” and stated that  it is the primary driver of behaviour because people are “able to live and even die for the sake of ideals and values” that give their life meaning.

If the will to meaning is the primary motivator of human behaviour, it is reasonable for corporations to tap into this motivator as a way to achieve their goals.

Unfortunately, although simple in concept, the ability to harness the will to meaning is difficult, mostly because although common to everyone, values tend to be very personal and intimate and vary from individual to individual. For a corporation to harness the will to meaning, it must be able to design an approach around a set of values that are held by virtually all persons regardless of race, age, gender, culture, religion, personality type or other differences.

A set of these common values is found in the book If Aristotle Ran General Motors, by Tom Morris. According to Morris, meaning for all human beings is founded on four transcendental values: truth, beauty, goodness and unity. He asserts they are “four timeless values for any productive relationship or organization, the four foundations of sustainable human excellence.”

These values also apply to corporations. For corporations, truth means taking explicit steps to ensure that truthful information (i.e., reflecting reality) is provided to all stakeholders at all times. This includes information within financial statements and all information communicated through various channels.

According to Morris, truth is important because it is the “foundation for trust, and nothing is more important for any business endeavour than trust. Truth is an absolute necessity for truly effective interpersonal relationships.”

A corporate commitment to truth can be fulfilled by:

With respect to how beauty fits in the corporate environment, Morris says, “There is a beauty to be experienced in solving a problem elegantly, in creating a business structure … and there is beauty in providing acknowledged excellence or quality in a service or product.” He also states that the importance of beauty “to corporate spirit may be inversely related to the attention it has received.… Socrates was right when he said the least important things we think and talk about the most, and the most important things we think and talk about the least. It’s time we turn that around.”
A corporate commitment to beauty can be demonstrated by:

Per Morris, goodness in a corporate environment essentially boils down to “proper personal development and good dealings with others” rather than a specific set of rules that can be circumvented using loopholes. He goes on to state “[t]here is one rule recognized in some form or other within every major human culture … the Golden Rule: Do unto others as you would have them do unto you.” According to Morris, this is the most important rule and can be applied in most business situations to ensure the right decisions and actions.

In a corporate environment, goodness is demonstrated by the explicit corporate commitment to acting in an ethical manner. Although this includes codes of ethics and whistleblower policies that are clearly written, understood and appropriately applied, it does not end there — it includes corporate leaders setting the right tone at the top by personally demonstrating their commitment to ethics and taking steps to explicitly encourage goodness by employees through tangible recognition and rewards for moral and ethical behaviour.

In addition, Morris says that morality and ethics are interchangeable. Although many people maintain that “ethics concerns public and professional conduct” and “morality is about private and personal values,” Morris states that this is “an inappropriate compartmentalization of our lives…. Life is a whole and must be approached as such.” Basically, we should demonstrate integrity by acting at work the same way we act at home, and a corporation should take steps to ensure this is encouraged.

Lastly, according to Morris, unity in a corporate context means helping people fulfill their deep need for a sense of the following:

He says unity relates to “connectedness, or intimate integration, between our thoughts and actions, between our beliefs and emotions, between ourselves and others, between human beings and the rest of nature.” He goes on to say that “[b]y respecting and nurturing the twin needs for a sense of uniqueness and a feeling of union among those around us, we help ourselves as well as our associates to attain that form of corporate spirit that is the wellspring of happiness, fulfillment and quality of the highest order in everything that we do.” This is related to what is often referred to as spirituality in the workplace.

A corporation can demonstrate a commitment to unity by:

The good news is that to some degree  most corporations are engaged in activities and programs that support the four transcendental values, even if not defined as such. For example, in addition to activities mentioned, with respect to the values of beauty and unity, most corporations have programs in place to improve and enhance employee morale, as well as programs to encourage work/life balance, flextime, shortened work weeks, telework options and employee assistance programs.

Most large corporations also engage in formalized activities to demonstrate good corporate citizenship, including active and visible support of community activities, public safety and a commitment to sustainable development and the environment. This demonstrates a commitment to beauty and goodness.

Although corporations already act in a manner that supports the four transcendental values, in most cases the approach can be improved by applying a rational, structured, defined approach. Corporations should consider the following steps to establish an overarching framework for meaning-based management:

Explicitly commit the corporation to a balanced approach to the four transcendental values:

Communicate the corporation-specific transcendental values to all stakeholder groups and declare that the corporation is committed to them. This will provide information that can be used by an individual to decide if he or she wants to be involved in a corporation as an employee, investor or other stakeholder. There will always be differences between people in terms of contentious issues like the production of tobacco and alcohol, performing certain health procedures, producing certain drugs, the creation of various types of pollution and even ownership of property. This will tie in closely to corporate social responsibility.

Create a formal process for periodically evaluating the corporation against the values. The mechanism for doing this may entail periodic interviews or surveys of stakeholders or some other form of an audit or assessment undertaken internally or by a third party. To be most effective, the results would be included in the annual report as part of a scorecard/dashboard or part of corporate social responsibility reporting. The committee would be responsible for this evaluation.

Since much of this meaning-based management relates directly to employees, job descriptions (including those of executives) should refer explicitly to the four transcendental values. In addition, the values should be used to formally select, evaluate and reward all employees through the recruitment and retention process.

Frankl wrote that the “frustrated will to meaning is vicariously compensated by a will to power, including the most primitive form of the will to power, the will to money.” This “will to money” is also known as greed, which has caused most of the scandals that plague the business world. For this reason, evaluating and rewarding senior and executive management according to the transcendental values is most important. These leaders set the tone and have the most power within a corporation.

A corporation is primarily humanistic — it is a collection of human beings united in the pursuit of goals that cannot be achieved individually. Because it is humanistic, it makes sense to align the collective decisions and actions of a corporation with the expectations and desires of the human stakeholders who comprise it. This can be done through meaning-based management founded in the philosophy of Frankl and guided by the four transcendental values of Morris.

Like corporate social responsibility, meaning-based management can help ensure that corporations retain a human face. By encouraging the right behaviour, meaning-based management can help corporations be places we choose to work at, invest in and buy from. And, because of that, it will ultimately help the corporation achieve its goals.

 

 

 

Murray Wolfe, CA, is the director of internal audit at a Canadian utility corporation. He can be reached at mdwolfe@telus.net

Technical editor: Peter Jackson, BA, CA, part- ner, Peter Jackson & Associates in Toronto

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