Rajeev Peshawaria Of The Stewardship Asia Centre On Why Corporate Culture Matters in Business

A culture of trust and collaboration saves costs and increases speed.

When people trust one another and collaborate by default, energy is spent on making the company more successful. If the culture is one of mistrust and solo action, it increases costs and slows down speed. A classic manifestation of this is the oft noticed cases of employees not surfacing mistakes in low trust, low collaboration environments. In the long-run, such companies are not as successful as those where trust and collaboration trump fear and retribution.

Every company has a corporate culture. This culture can foster innovation and a fresh exchange of ideas, or it can promote selfishness and backbiting which will damage the bottom line of any business. Sensitivity to the culture of a business goes beyond mere awareness; it’s about actively adapting and responding to create the culture that you want to represent your brand. This is crucial for building successful, respectful, and inclusive working environments and for creating products and services that resonate with a diverse customer base. As part of this series, we had the pleasure of interviewing Rajeev Peshawaria.

Rajeev Peshawaria, author of Sustainable Sustainability, CEO of Stewardship Asia Centre in Singapore, Forbes contributor, and sought-after international speaker, is an out-of-the-box thought leader on leadership, management, and corporate governance. In 2014 and 2017, he was named one of the Top 100 Global Thought Leaders for Trustworthy Business by ‘Trust Across America,’ and has provided speaking, coaching, consulting, and advisory services to clients including Johnson & Johnson, Nike, Citibank, and the US Treasury.

Thank you so much for joining us in this interview series. Before we dive into our discussion about Why Corporate Culture Matters in Business, our readers would love to “get to know you” a bit better. Can you share with us the backstory about what brought you to your specific career path?

I started out as a banker and currency trader. Back then, the most important thing for people of my generation was to land a “good, high-paying job.” We seldom asked ourselves what we really wanted to do in our professional life, or what would make us happy. So when I landed a job with American Express straight after college, it checked all the boxes. A couple of years later I married the woman I loved, and life was supposedly all set.

It all changed with the sudden unexpected death of both my parents in a car accident. To cut a long story short, to my surprise, literally the whole town showed up for their funeral, and some state government offices declared a day off for mourning. Why is the death of two ordinary people attracting so much attention, I wondered. As tributes started pouring in, for the first time I realized that they were far from ordinary. Having spent my formative years away from home in a boarding school, I had no idea that they had helped so many people, and that they were considered beacons of compassion and integrity. This led me to introspect about how I could follow in their footsteps to touch so many lives in such a meaningful way. After careful analysis, I decided to switch my career from finance to human resources development. The rest, as they say, is history.

Can you share the most interesting story that happened to you since you started your career?

Nothing beats the story I just shared. The biggest thing that happened to me was realizing that to make a huge difference you don’t need to be rich, famous, or gifted. You only need a heart full of compassion, and a deep desire to give as much as you can and to make your life worth living. Sadly, I only realized it after losing the two most important people in my life. I could not bring them back, but I decided to dedicate the rest of my professional career in helping people realize what I realized that day: Chase life worth, not net worth. If you make your life worth living, your net worth needs will take care of themselves.

You are a successful individual. Which three character traits do you think were most instrumental to your success? Can you please share a story or example for each?

There have been four for me, not three. And they are gratitude, acceptance, forgiveness, and innovation. These words sound simple and obvious, but the default wiring of the human brain is just the opposite.

Gratitude:

We spend more time worrying about what we don’t have, and what is not right, than on all the gifts we already have in life. The brain looks for pain (so that one can avoid it) rather than for pleasure. Gratitude turns this wiring upside down by proactively practicing appreciation and being thankful for all that is positive in our lives. Over time, this practice helps us get over setbacks and makes us resilient.

Acceptance:

When faced with adversity, the default wiring of the brain uses hope, blame, and denial as coping strategies. Rather than accepting reality and taking responsibility, we keep hoping that the problem will go away. In some cases, we blame and curse others for the problem, again failing to take responsibility to fix the situation. Denial is the third form of default response. It is well known that hope, blame, and denial are not strategies. Cultivating the habit of accepting reality in all its ugliness and deciding to do something about it, is the way to go.

Forgiveness:

This is the hardest, but most liberating. Instead of letting someone live rent free in our minds, what if we forgive them? What if we shed the desire for revenge and replace it with deep compassion? Once I realized these things, my life changed infinitely for the better. Not only did I become more successful in my professional life, I discovered what it meant to be really happy.

Innovation:

Finally, what has helped me the most in my career is innovation. I am no genius, but somewhere down the line I developed the habit of questioning conventional wisdom. Soon, this became my default way of thinking. I am always looking for ways to make things better, and this has been by far the biggest factor in whatever success I have earned.

Ok, thank you for that. Let’s now jump to the primary focus of our interview. How do you define corporate culture in the context of your business, and why is it important for your company’s success?

Culture is what people do when no one is looking.

The default wiring of the human brain is to take care of personal interest and maximize personal gain. Most people see life as a zero-sum game. So, unless leaders shape an organizational culture other than the default, the organization will be full of people who try to maximize personal gain at any cost.

An organization exists to achieve a common purpose. It exists on the belief that a group of people working together based on shared beliefs can achieve more than the sum of each person working individually. For example, if the organization believes that the more it gives value to society, the more it will succeed, and if this belief is firmly embedded in the organization’s culture, then employees will act based on that belief even when no one is looking, and even if the decision forgoes some short-term gains.

Can you share an experience where corporate culture impacted a business decision or client relationship (positive or negative)?

In 2008, the Taj Mahal hotel in Mumbai India was under the siege of terrorists. It was dinner time, and the hotel was full of diners and staying guests. As terrorists were indiscriminately spraying bullets, hardly any employee of the hotel fled to save their own life.

Instead, at grave personal risk, the hotel employees led guests out of harm’s way. They even formed human rings around their guests to save them from being shot. The largest number of casualties that night were the hotel employees, but they saved many lives before giving up their own. This was culture (shared values) in action, and the most powerful one I have ever witnessed.

What strategies do you employ to monitor and enhance corporate culture within your team or organization?

How do you create a culture like the one that prevailed in the Taj Mahal hotel that night? How do you create and maintain any culture? The short answer is this: Develop a strong sense of purpose (what the business wants to give to society) and shared values (the principles that guide human behavior).

But crafting and communicating catchy purpose and values statements is far from enough. Ultimately, what creates a culture — positive or negative — is the extent to which leaders walk the talk. At Enron, there was big talk about integrity and service, but the actions of leaders were exactly the opposite.

So, the strategy for creating a desired culture is a combination of articulating a worthy purpose based on shared values, and then demonstrating behavior in alignment with those. Leaders’ actions speak louder than their words.

What is not helpful is trying to control behavior by making strict rules and policies. Real leadership is about leading with values rather than rules.

How do you handle situations where the executives may not be aware of corporate culture in mid-management?

The only reason for mid-management not knowing the culture is the lack of senior leaders visibly living the values that make up the desired culture. If employees see leaders role-modeling the behaviors they want to see in the organization, most will fall in line.

If, despite best efforts on the part of leaders some still do not live the values, they should be coached. If coaching too does not work, they need to be let go. There is no other way.

The hardest is to let go of rain-maker employees — those who produce excellent results but do not believe in the company’s values. The sooner such employees are let go, the better it will be for the organization in the long run. It is hard indeed, but over time, such employees do more harm than good to the organization.

Based on your experience and research, can you please share “5 Reasons How Corporate Culture Helps the Bottom Line of a Business?”

Another way of thinking about culture is this:

Culture is your organization’s values in action, or inaction.

What I mean by that is that either most of the employees proactively live the shared values, or they don’t. In both cases, that is the prevailing culture of the organization. Now the reason why we try to create and maintain an organizational culture is because we believe that behaviors based on certain values will make the business more successful. Here are some ways in which this pans out:

1. Culture tells people to do the right thing even when no one is looking.

I recently visited a client at his office in Zurich. He told me he had been invited to speak at a conference in New York and that the trip would be fully paid for by the sponsoring organization. The Zurich based company has very strong guidelines in place to avoid travel because they are sincerely trying to reduce their carbon footprint. Only absolutely essential travel is allowed, and employees are encouraged to use teleconferencing wherever possible. My client told me that his boss had approved the trip based on the fact that the carbon footprint would not be counted in their company’s accounting because the trip was paid for by the sponsor.

Despite that, my client decided not to travel, and speak remotely at the conference. “I wanted to uphold the spirit rather than the letter of the policy at our company, so I pushed back with my boss,” he told me. This is culture, and actions such as these enhance company reputation, and therefore the bottom-line.

2. Culture allows employees to take ownership to do the right thing, or not.

At Netflix, they replaced a detailed travel and entertainment policy with one sentence: Act in Netflix’ best interest. Now it was up to employees to decide how to spend company money when they traveled for business. No more rules. Overall travel and entertainment expenses went down, not up.

Contrast this with the infamous incident a few years ago of United Airlines staff beating up a passenger and dragging him off a plane because he refused to give up his seat voluntarily. “We were following policy, there was nothing we could do differently,” is what they said in that situation.

3. Values based decision making and empowerment frees up managers to focus on what they can do best.

One of the most powerful things I learned about leading people is to empower them to act according to values and purpose rather than control them with policies. Once they are guided by shared values and purpose, they perform better and more independently. As a result, it frees me up to focus on strategic issues rather than day-to-day people management, which in turn benefits the bottom-line.

4. A culture of trust and collaboration saves costs and increases speed.

When people trust one another and collaborate by default, energy is spent on making the company more successful. If the culture is one of mistrust and solo action, it increases costs and slows down speed. A classic manifestation of this is the oft noticed cases of employees not surfacing mistakes in low trust, low collaboration environments. In the long-run, such companies are not as successful as those where trust and collaboration trump fear and retribution.

5. A service-oriented culture encourages employees to go the extra mile to make customers happy.

I spent the first 12 years of my career at American Express. Right from Day One, we were made to understand that it is service excellence which makes the company successful. We were rewarded not just based on the achievement of KPIs but equally on our demonstration of living the “blue-box values.”

It is no surprise that American Express is so well known for its legendary customer service. Even though they charge higher fees compared to most other banks, their customer base is extremely loyal.

In what ways has focusing on Corporate Culture given your business a competitive edge?

I have tried my best to practice and role-model the principles I mentioned earlier — Gratitude, Acceptance, Forgiveness, Empowerment, and Innovation. Somehow, that has laid the cultural foundation of teams and organizations I have led. This has benefitted both my organizations and me by way of increased ownership and responsibility shown by my colleagues.

You are a person of great influence. If you could start a movement that would bring the most amount of good to the most amount of people, what would that be? You never know what your idea can trigger. :-)

I’ve just written a book about that. It is well known that we need to address today’s existential challenges — climate change, social inequality, and cyber vulnerability — with great urgency.

Unfortunately, the world is using regulation and incentives (sticks and carrots) to save planet Earth and humanity. Our research tells us that both these tools are inadequate in creating the innovation needed to find profitable solutions for today’s challenges.

Innovation can neither be legislated, nor driven by extrinsic rewards alone. To address the challenges in a meaningful way we need a values-based revolution. We need to upgrade our understanding of leadership to Steward Leadership, which is the genuine desire and persistence to create a collective better future for stakeholders, society, future generations, and the environment.

Steward leaders see themselves as stewards of society and the environment and strive hard to marry purpose with profit. Believing in the values of interdependence, long-term view, ownership mentality, and creative resilience, they relentlessly pursue a purpose that creates a collective better future. We need more steward leaders if we are to save the Earth — our only home.

My book Sustainable Sustainability: Why ESG is Not Enough is a playbook for any business leader that wants to do well by doing good. We need this!

How can our readers further follow you online?

Linkedin @RajeevPeshawaria is the best way. I also write for Forbes.com, and have a YouTube Channel. I’ve been told by many to get active on Instagram, but I am yet to do so. Maybe soon.

Thank you for the time you spent sharing these fantastic insights. We wish you only continued success in your great work!

About The Interviewer: Vanessa Ogle is a mom, entrepreneur, inventor, writer, and singer/songwriter. Vanessa’s talent in building world-class leadership teams focused on diversity, a culture of service, and innovation through inclusion allowed her to be one of the most acclaimed Latina CEO’s in the last 30 years. She collaborated with the world’s leading technology and content companies such as Netflix, Amazon, HBO, and Broadcom to bring innovative solutions to travelers and hotels around the world. Vanessa is the lead inventor on 120+ U.S. Patents. Accolades include: FAST 100, Entrepreneur 360 Best Companies, Inc. 500 and then another six times on the Inc. 5000. Vanessa was personally honored with Inc. 100 Female Founder’s Award, Ernst and Young’s Entrepreneur of the Year Award, and Enterprising Women of the Year among others. Vanessa now spends her time sharing stories to inspire and give hope through articles, speaking engagements and music. In her spare time she writes and plays music in the Amazon best selling new band HigherHill, teaches surfing clinics, trains dogs, and cheers on her children.

Please connect with Vanessa here on linkedin and subscribe to her newsletter Unplugged as well as follow her on Substack, Instagram, Facebook, and X and of course on her website VanessaOgle.