EngagementCultureWhat can HR learn from toxic cultures to initiate change?

What can HR learn from toxic cultures to initiate change?

Employees will no longer stand for mistreatment at a cultural level, and demand change. How can HR learn from cultural mistakes to spark a revolution? Using the recent controversy in Lloyd's of London as a starting point, Sylvia Sage investigates.

The macho culture of the past is no longer acceptable.

Recent reports of sexual harassment and inappropriate behaviour at Lloyd’s of London, the world’s biggest and oldest insurance market, should be a wake-up call to all businesses.

The independent survey commissioned by Lloyd’s revealed that one in twelve workers had seen harassment in the last 12 months.

The survey followed a stream of complaints of bullying and sexism at Lloyd’s earlier this year.  It highlights the ongoing issue of discrimination and the ‘boys’ club’ behaviour at the insurance market.

This, despite previous moves by Lloyd’s to boost reporting of harassment and stamp out inappropriate behaviour by measures such as banning alcohol during office hours.  Still some 22% had seen people in the organisation “turn a blind eye” to inappropriate behaviour.

The problem is that tackling such issues requires a cultural change throughout the business, led from the top.

This is a difficult thing in a large and traditional organisation like Lloyd’s, where attitudes and behaviours are very entrenched.

Lloyd’s is far from being alone in needing to tackle discrimination, harassment and bullying.  Businesses, charities and the public sector have been subject to a string of high-profile controversies in recent months and years.

Organisations can no longer afford to ignore these issues which, aside from the negative publicity, damage staff’s mental and physical wellbeing.

This may result in talented staff underperforming and lead to a rise in sick leave and staff turnover.

An unhappy workforce is a less productive workforce, so, besides the human cost, it will ultimately damage a business’s bottom line.

What can be done?

How to initiate culture change throughout an organisation

If HR is to successfully facilitate a long-term shift in attitudes and behaviour, everyone at the organisation must be engaged in the process right from the start.

At Lloyd’s it is clear there is deep division and dissatisfaction within teams.  One in five workers said they did not believe they had equal opportunities, regardless of gender.

This is where HR can be instrumental in bringing teams together to reach consensus on the ethics and values they can unite behind.  Defining common values helps to create a happier, more respectful and secure workplace.

HR must ensure everyone throughout the organisation, from the CEO down, understands what constitutes inappropriate behaviour and its impact.

This is a process of education and communication which should result in clear company policies, and understood and truly share values.  Every individual staff member should understand and hold themselves and others accountable to such values.

What constitutes harassment and inappropriate behaviour?

Discrimination is less favourable treatment of another person or group.  Harassment is behaviour that makes someone feel threatened, offended, excluded, undermined, or creates a hostile or intimidating environment.

Essentially, it is the impact of the behaviour rather than the intent that is important.  A particular behaviour might be considered harassment, even if the effect is unintended.

Harassment and discrimination are against the law in the UK, especially when they are a condition of employment, when they are severe enough to be considered intimidating, hostile or abusive or when they are related to nine protected characteristics, which are defined by the Equality Act 2010.

HR must work with everyone at all levels within a business to ensure there is a clear understanding of these definitions.

Building positive values

The next step is to encourage everyone to agree upon a common purpose and shared values which foster mutual care and respect between all staff.

To do this, HR teams might facilitate a discursive and safe space in which everyone feels able to open up and share their views.

This process of bringing everyone together to put their ideas on the table helps to create a shared ‘pool of meaning’, as described in Crucial Conversations, by Kerry Patterson et al. (2011).  It is an essential ingredient for a more unified team with appropriate behaviour.

During such discussions, it helps filter out key concerns and stressors that have been causing tension.

Such discussions are just one small step in a healing process but, crucially, they open up Dialogue and foster mutual understanding of different people’s perspectives and needs.

Once the shared values have been agreed upon, HR should take a key role in clearly communicating these so that everyone understands what they are uniting behind.

Facilitate defence

With more educated and united employees, inappropriate behaviour should be minimal.  But businesses should have clearly defined informal and formal steps employees can take to raise and address concerns as early as possible – before a situation escalates.

An open-door policy that makes HR and senior managers within the company available and approachable is important.

If the issues cannot be dealt with informally, the HR team must take more formal steps to monitor and tackle the issue.  This might mean keeping a written record of all actions and speaking to those involved to formulate an appropriate response.

All HR departments should have designated Inclusion and Dignity at Work officers.  These people will be appropriately trained in relevant respectful workplace legislation and the organisation’s policies and procedures.

Any complaint should be investigated and all parties consulted in a sensitive and confidential manner, with appropriate support offered to the alleged victim.

Sometimes, dealing with workplace tensions is a simple case of speaking to the ‘bully’ who may be unaware of the damaging impact of their behaviour.  However, HR teams and senior managers must be prepared to take more stringent disciplinary action when necessary.

Change for good

Lloyd’s has said it will launch a gender balance plan with “measurable and achievable targets” alongside publishing new standards of business conduct.  It will also establish an advisory group to drive “cultural transformation”.

While these are positive moves, they will only work if everyone at Lloyd’s feels engaged in the process.  Culture change cannot be imposed from the top down and cannot be done overnight.

To create a happy and productive workplace, HR must work closely with company bosses and other influential people within the organisation, to create a culture of respect, based on shared values, where those in charge act as role models.

If Lloyd’s successfully tackles its issues, it is likely to see a direct impact upon the performance of its staff.  Happier employees are healthier, more energised and motivated.  This is a change worth investing in.


By Sylvia Sage, programme director at Corporate Learning Solutions, specialist in leadership and management and soft skills training and coaching.

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