Corporate Values

Conceptual Overview

Corporate values possess the same attributes that compose the framework developed for understanding human values. This assertion is reasonable given that both individuals and organizations are systems directed at managing information in order to achieve shortand long-term aspirations. At the individual level, one's values reveal what he or she believes to be important in life and they provide direction for how one will go about actualizing one's ambitions. Milton Rokeach wrote in 1973 that one's values can be divided into two categories: instrumental and terminal. Instrumental values are the means for achieving one's ends (the how) and terminal values represent the desired end state, or one's ultimate aspirations.

The same categorizations hold true for organizations. Corporate values shape the formal and informal processes that are produced in order to achieve the company's goals and its overarching purpose. At the most explicit level, key organizational values, also referred to as core values, are defined in the corporate mission and vision statements. Jim Collins and Jerry Porras wrote in 1994 that corporate values are central and enduring tenets of the organization, forming the glue that holds it together as it grows and changes over time. As noted by Collins in 2001, core values are a hallmark of successful and lasting organizations. Collins's research produced an interesting finding: It does not matter what core values a company has. What matters is that they do have them and that they are [Page 306]explicitly named, practiced, and maintained throughout the company's lifetime.

Corporate values are also expressed implicitly through an organization's culture. In 1985, Edgar Schein wrote that corporate culture is a powerful force that informs the norms, ideologies, strategies, and philosophies central to an organization. These values contribute to the unconscious beliefs, perceptions, and even thoughts and feelings of organizational members. They create what today is more commonly referred to as the “rules of the game” that are enacted in work life.

It is widely agreed that corporate culture is difficult to change. This is true because an organization's culture is shaped by belief systems and values that have become embedded over time and because they also have a somewhat amorphous nature. It is not easy to show someone a value or a belief. Schein wrote that the best way to see an organization's values is through its structures and processes, dress codes, and by what behaviors are acceptable and unacceptable. Schein further stated that an organization's values serve as the criteria for evaluating, accepting, or rejecting what is ethical, good, valid, appropriate, and desirable. These particulars allow us to more easily understand how corporate values are enacted by organizational members, as well as to highlight their deeply entrenched nature.

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