The key role of an organisation’s ethical stance - comment

Amid a widespread move to remote working, bosses should give more attention to company culture and ethics, Benjamin Lange and Rob Hayward believe.
RBS wants more than 50,000 staff to keep working from home into 2021, note Lange and Hayward. Picture: Jane Barlow.RBS wants more than 50,000 staff to keep working from home into 2021, note Lange and Hayward. Picture: Jane Barlow.
RBS wants more than 50,000 staff to keep working from home into 2021, note Lange and Hayward. Picture: Jane Barlow.

Recently, Royal Bank of Scotland – now officially under the NatWest Group branding – informed more than 50,000 staff that they should continue working from home into 2021. Companies across the UK have followed suit, with Savills reporting that firms in central London have begun offloading almost one million square feet of office space.

For the financial sector, lockdown has provided an unexpected stress test. For the most part, the banks passed the test, scaling up technologies that allowed people to work from home, and working hand-in-hand with regulators to maintain business continuity and resilience.

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And realising that effective remote working requires more just a laptop and a kitchen table, many have also rolled out programmes to promote employees’ effectiveness while looking after their physical and mental wellbeing.

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But as it becomes clear that remote working is unlikely to be temporary, companies are beginning to confront a more radical change in the future of work.For many, the office will be a thing of the past, and working from home will be the new normal. Leaders are already beginning to assess the implications of this shift.

Many discussions have rightly focussed on individual employees: while many will embrace the opportunity to avoid the daily commute, others may struggle, and companies must be careful not to enforce a new class divide between those able to work from home and those constrained by the demands of “old style” working.

But as leaders and HR departments grapple with these questions, a bigger question already looms on the horizon: what does a shift to remote working mean for the culture of the banks?

The 2008 financial crisis showed that culture – the values by which banks operate, and the attitudes and beliefs that shape the way their people behave – is as important as formal controls in shaping conduct. We know that the way we behave is not just shaped by our own values and beliefs, but by the influence of those around us. In a professional setting, the decisions we make are informed not just by the rules we must obey, but by our understanding of why we come to work.

Purpose

One of the most powerful forces in shaping the way people behave is a sense of common purpose. In seeking to build this unifying purpose, many banks have focused on the “tone from the top,” ensuring that leaders are highly visible in talking about purpose, ethics and values. Others have invested in activating those messages day to day, through training that encourages colleagues to speak openly about ethical grey areas and the right thing to do.

But for many banks, the informal interactions that shape culture and drive cohesion – the chance encounter in the lift, or the conversation in the corridor – have been dismantled overnight.

In a radically different working environment, banks will face new challenges. As human contact diminishes, so will leaders’ ability to shape a common culture that enables their people to do the right thing.

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In an environment where every interaction must be scheduled, and conversations are filtered through the impersonal lens of a computer screen, building trust and creating space for debate will demand new thinking.

Leaders will need to adopt a more intentional approach to culture, understanding the factors that shape the ability of their people to do the right thing. They will need to find new ways to build remote communities, instilling shared purpose, values, and mutual trust among disparate teams. And they will need to move beyond annual engagement surveys to dig deeper and monitor the ethical health of their organisations.

In the context of what could be the worst economic downturn since the Depression, banking leaders and regulators may be tempted to relax their focus on culture. But guarding against a return to pre-crisis behaviours will demand that leaders step up their efforts to understand what makes their people do the right thing, and that regulators keep up the pressure on boards and executive teams to demonstrate insight and action.

Leaders cannot afford to underestimate the challenge that lies ahead. The way that companies behave now, and into the recovery, will define them for years to come. And with more attention than ever before on the ethics of business, there is no room for complacency. Only by understanding the drivers of culture can banks ensure that their people are equipped with the ability to do the right thing, every day.

Benjamin Lange is a specialist advisor and Rob Hayward is chief operating officer at Principia Advisory, a network of academics and practitioners committed to building ethical organisations, based in Edinburgh.

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