CORPORATE CULTURE
Beyond the silo
Mahendra Amarasuriya
Mahendra Amarasuriya is the Chairman of Equity Investments Lanka
Mahendra Amarasuriya believes the best definition of corporate culture he has come across is that it’s ‘how employees act when no one is looking.’ Of course, corporate culture is very important for any organisation and is said to be the foundation of a company.
It comprises a set of values and norms that guide how businesses operate. This does not happen by chance; it has to be planned and implemented. The pillars of a solid corporate culture are its mission, vision, values, guiding principles, purpose and behaviour.
Commenting on the trends in Sri Lanka, the veteran business leader says: “Many companies are not interested in creating a unique corporate culture as they’re more focussed on achieving targeted bottom lines irrespective of other considerations.”
“However, more and more well organised and managed companies are making an effort to develop sustainable corporate cultures, which has promoted rapid and sustainable growth,” he adds.
Amarasuriya believes that a roadblock to establishing a good corporate culture is a ‘profit at any cost’ mentality, which is perhaps the most significant constraint. He muses: “It requires a special effort on the part of the top management as a certain amount of research and deliberation is involved in developing the pillars of a good corporate culture.”
Stating his view on who should build and engender the culture in a company, he opines that the chairman and board of directors are primarily responsible for developing an acceptable and sustainable corporate culture.
However, shareholders and stakeholders can influence this process through the views they express regarding a company’s progress and development.
Furthermore, the media – both print and electronic – can also influence businesses to develop robust cultures through efforts recognising those that have done so successfully. In recent times, many organisations have made special attempts through objective assessments to promote a good corporate culture.
Sharing his thoughts on how corporate culture determines the growth trajectory of an organisation, Amarasuriya explains that “growth in the long term must be based on conforming to all regulations applicable to the operations of a company.”
“Environmental issues are also very important. A company or an institution is not ‘an island’ isolated from society,” he stresses, continuing: “Rather, such an entity should be considered a part of the community it serves; the company must be concerned about all stakeholders who constitute the society in which it operates as well as the environmental impacts of the projects it undertakes.”
To this end, Amarasuriya adds: “For example, when embarking on a new project, an environmental impact assessment (EIA) is an absolute necessity – and projects that affect the environment should not be undertaken by companies with good corporate cultures.”
But there are many companies in Sri Lanka that are respected for their corporate culture so they must be doing something right…?
He responds: “These companies are conscious of the need to serve the communities in which they operate and many actively fulfil their CSR duties by allocating a share of profits to carrying out projects that benefit society – whether they are connected to the businesses’ normal operations or irrespective of the field in which they’re engaged. They appreciate the needs of the society that can be fulfilled by them.”
Many companies with solid corporate practices follow the triple bottom line, which is an accounting framework that encompasses three dimensions of performance – viz. social, environmental and financial. This differs from the traditional approach, and includes environmental and social measures that may be difficult to assess.
Amarasuriya notes that in recent times, more research has been conducted on ways and means of assessing the triple bottom line approach, which is also commonly referred to as ‘people, planet and profits.’
