In the modern business landscape, fostering a culture of accountability is paramount for organisational success and ethical behaviour. Yvonne Kelleher and Conor McCarthy discuss the crucial connection between culture and accountability
Culture and accountability are not new concepts. However, for many organisations, driving a culture of accountability seems like an intangible feat, with many organisations leaping to enhance the operating model without recognising the need to manage the human factors.
This can be a costly oversight, and without considering a unified approach and mindset to drive accountability, the desired benefit and return will not be realised.
Executives must set a leading example in this time of increased public and regulatory scrutiny and change in Ireland and globally. They need to exhibit accountability and maintain trust with both stakeholders and employees.
Culture and accountability are not static ideas, nor do they impact one industry.
In fact, in Ireland, we have seen over the last 12 months a lack of accountability underpinned by poor behavioural drivers across a range of industries such as financial services, public bodies and broadcasting has resulted in computational damage and a loss of stakeholder and employee trust.
Time is of the essence for organisations to conduct a stocktake, reassess their culture journey and address any gaps to promote and embed an effective and resilient culture to drive and enforce accountability.
Organisations should look at this as not only a necessity but also an opportunity that will support their success in the long run.
Organisational accountability – what is it?
Organisational accountability occurs when all employees behave in a way that promotes the successful and timely completion of their responsibilities.
It involves the organisation being answerable for its actions, decisions and impact on stakeholders, including employees, customers, shareholders, communities and, of course, the environment.
A poor culture of accountability can present itself in several ways.
Lack of transparency
There is often a lack of transparency in decision-making processes, communication and reporting. Information may also be withheld, buried, distorted or not shared openly with stakeholders.
Lack of clarity in roles and responsibilities
When there is a lack of clarity regarding roles, responsibilities and expectations, it becomes challenging to establish accountability.
Unclear lines of authority, ambiguous decision-making processes, and overlapping responsibilities can contribute to a culture where no one feels truly responsible or accountable for outcomes.
Lack of leadership
Leadership plays a crucial role in shaping the culture of an organisation.
In a poor culture of accountability, leaders may fail to model and uphold the principles of accountability. Leaders evading responsibility or engaging in unethical behaviour without facing the consequences sets a negative example for others.
Lack of trust
There may be an environment of distrust and scepticism. This can lead to a lack of collaboration, communication and willingness to report issues and mistakes.
Low consequences for misconduct
In organisations with a poor culture of accountability, there may be a lack of appropriate consequences for unethical behaviour or poor performance. This can lead individuals to believe they can engage in misconduct without facing significant repercussions.
Fear of retaliation
Conversely, a poor culture of accountability may foster an environment where individuals fear retaliation for speaking up, reporting wrongdoing or challenging the status quo.
This fear can deter individuals from holding themselves or others accountable, leading to a lack of transparency and the perpetuation of negative behaviours.
It is crucial, therefore, to get a balance between consequences and a fear of retaliation.
Low morale
A lack of organisational accountability can diminish an employee’s sense of purpose. This results in a lack of motivation to do your job and impacts the quality of employees’ work.
The link between culture and accountability
Today, an organisation’s success is no longer just about the bottom line; qualitative inputs like transparency, trust and employee performance, productivity, collaboration and engagement also determine success.
Therefore, an organisation’s cultural norms, values and practices can significantly influence the expected, accepted and enforced accountability level to ensure sustainable change.
Culture affects the level of trust and transparency within an organisation. In cultures where trust is high, and transparency is valued, accountability tends to be emphasised more.
Employees tend to hold themselves accountable for their actions as they believe in the importance of integrity and honesty.
2. Consequences and enforcement
Cultural attitudes towards consequences and enforcement also play a role in accountability.
In some cultures, the fear of reputation, trial by the media or social stigma may serve as a powerful deterrent leading individuals to be more accountable for their actions.
In other cultures, legal frameworks and regulatory systems play a key role in enforcing accountability (like the new individual accountability regime currently being implemented by the Central Bank in regulated institutions within Ireland).
Cultural influences
Cultural influences on accountability can vary significantly across different societies and organisations, particularly as the operating and workforce landscape evolves.
While some cultures may prioritise individual accountability, others may emphasise collective responsibility more. Understanding and addressing these cultural dynamics, including behavioural drivers, are essential for promoting a sustainable culture of accountability and ethical behaviour.
Yvonne Kelleher is Managing Director in Risk Consulting at KPMG
Conor McCarthy is Partner, Head of People and Change at KPMG
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