Tue, 29 Apr 2008 | The Australian Financial Review | Fiona Smith.

Cynics may dismiss them, but company values have a serious purpose, writes Fiona Smith.

When chief executives start banging on about company values, people start to switch off. Yawn. Boring. Irrelevant. Throw in the words culture, employer value proposition, employer of choice and diversity, and if you’re still awake, you probably work in human resources.

It can be hard to convince cynics they should take these well-meaning concepts seriously. But just because something is difficult, it doesn’t mean it’s not worth doing.

While poor company values are often held up as the core reason US energy and company Enron collapsed in 2001 and, in Australia, the National Australia Bank lost $360 million because of rogue traders in 2004 – most workers don’t believe they will be caught up in such a scandal.

They may dismiss company values as an attempt to forestall fraud, an exercise in group thinking, or a marketing campaign designed to project a wholesome image of the company.

But the director of business consultancy Mettle Group, Katharine McLennan, says setting out the values of an organisation has a more straightforward purpose – it creates order.

“The reason the values are important – because a lot of ‘command and control style’, old-fashioned executives think it wounds like a load of rubbish – is because the imperfect values in an organisation create so much noise in people’s brains that it takes the focus away and takes away the ability of the employee to create,” She says.