Bridging the Values Gap: How Authentic Organizations Bring Values to Life

Business has a values problem. It's not just spectacular public scandals like Enron (which, incidentally, had a great corporate values statement). Many companies fail to live up to the standards they set for themselves, alienating the public and leaving employees cynical and disengaged—resulting in lower productivity, less innovation, and sometimes outright corruption.

The reason, argue top scholars and consultants Edward Freeman and Ellen Auster, is that all too often values are handed down from on high, with little employee input, discussion, or connection to the challenges and opportunities facing the organization. Although the words may be well-intentioned, they aren't reflected in the everyday practices, policies, and processes of the organization. This practically invites disconnects between intention and reality.

To bridge this gap between the “talk” and the “walk”, Freeman and Auster provide a process through which organizations can collectively surface deeply held values that truly resonate with everyone, from top to bottom. Their Values Through Conversation (VTC) process focuses on four key types of values conversations: introspective (reflecting on ourselves and how we do things in the organization), historical (exploring our understanding of our past and how it impacts us), connectedness (creating a strong community where we work well together), and aspirational (sharing our hopes and dreams).

By developing values through discussions—casual or formal, one-on-one or in groups—VTC ensures that values are dynamic and evolving, not static words on a wall or a website. Freeman and Auster offer advice, real-world examples, and sample questions to help you create values that are authentic and embraced because they are rooted in the lived experience of the organization.

About the Authors

R. Edward Freeman is university professor and Olsson professor of business administration; academic director of the Business Roundtable Institute for Corporate Ethics; and an academic director of the Institute for Business in Society at the Darden School, University of Virginia. He is also adjunct professor of stakeholder management at the Copenhagen Business School in Denmark, visiting professor at Nyenrode Business University in the Netherlands, adjunct professor of management at Monash University in Australia, and visiting professor at the International Centre for Corporate Social Responsibility at Nottingham University in England. He has held honorary appointments as the Welling professor at George Washington University and the Gourlay professorship at the University of Melbourne. Prior to the Darden School, Freeman taught at the University of Minnesota and at the Wharton School at the University of Pennsylvania.

Freeman is a co-author of Stakeholder Theory: The State of the Art (Cambridge University Press, 2010) and of Managing for Stakeholders: Survival, Reputation, and Success (Yale University Press, 2007). He is the author or editor of more than 20 volumes and 100 articles in the fields of stakeholder management, business strategy, and business ethics. Freeman is perhaps best known for his award-winning book Strategic Management: A Stakeholder Approach (Cambridge University Press, 1984, 2010), where he traces the origins of the stakeholder idea to a number of others and suggests that businesses build their strategy around their relationships with key stakeholders. He is the editor of the Ruffin Series in Business Ethics (15 volumes, Oxford University Press). He is also a co-editor with Jeremy Moon and Mette Morsing of the Business, Value Creation, and Society Series (11 volumes, Cambridge University Press).

Freeman has a PhD in philosophy from Washington University and a BA in mathematics and philosophy from Duke University. He was recently awarded honorary doctorates in economics from Comillas Pontifical University in Madrid and the Hanken School of Economics in Helsinki, as well as an honorary doctorate in management science from Radboud University Nijmegen in the Netherlands for his work on stakeholder theory and business ethics. Throughout his career he has received a number of teaching awards from the Wharton School, the Carlson School of Management, the Darden School, the University of Virginia, the state of Virginia, and the Academy of Management. He has received Lifetime Achievement Awards from the World Resources Institute, the Aspen Institute, the Humboldt University Conference on Corporate Social Responsibility, and the Society for Business Ethics. He has worked with many executives and companies around the world.

Ellen R. Auster is professor of strategic management and the founding director of the Schulich Centre for Teaching Excellence at the Schulich School of Business at York University. Prior to joining Schulich, she was on the faculty at the Graduate School of Business at Columbia University and was a visiting faculty member at the Tuck School of Business at Dartmouth College in Hanover, New Hampshire. She earned her BA from Colgate University and her PhD from Cornell University.

Auster has more than 30 years of experience as an academic and a consultant specializing in strategic turnarounds, transformations, and transitions. Working with executives and managers to successfully tackle a wide spectrum of strategic change challenges in industries ranging from manufacturing and consumer goods to financial services, she creates a shared-leadership, stakeholder-inclusive, value-creating approach that enables the firm to cultivate the short- and long-term capabilities needed for continuous evolution and success.

A multiple research and teaching award winner, Auster has been honored with the prestigious global, lifetime achievement Academy of Management Distinguished Educator Award. She has also received research awards from the Academy of Management and Management Science, and she has twice been named a Kellogg-Schulich Executive MBA Professor of the Year as well as being honored with the Seymour Schulich Teaching Excellence Award and the Outstanding Educator of the Year Award at York University.

Auster has written and co-authored several other books, including Strategic Organizational Change: Building Change Capabilities in Your Organization (Palgrave Macmillan, 2005); Excellence in Business Teaching: A Quick Start Guide (McGraw-Hill, 2005); and Stragility (Rotman/University of Toronto, 2016). She is published widely in academic journals, including the Academy of Management Review, Management Science, Sloan Management Review, the Journal of Business Ethics, Human Resource Management, the Journal of International Management, the International Journal of Strategic Change Management, the Journal of Applied Behavioral Science, the American Journal of Economics and Sociology, Sociological Inquiry, Advances in Strategic Management, the Journal of Management Education, and Research Policy.