Definition of corporate values
Corporate values are the principles of behavior, rules, and ideas that a company identifies with and that guide how it lives and operates as a whole. They act as a compass, pointing to where the company should be heading, how employees should behave, and what customers can expect. Corporate values are an integral part of a company's corporate culture.
Why do they matter so much?
In companies that take corporate values seriously, success isn't built on business and financial results alone. Corporate values play a role throughout the entire life of a company and should go hand in hand with its focus on its goals.
You could say that results actually show how a company has performed in the past, while corporate values — and the respect shown for them — determine how the company will perform going forward.
What well-defined corporate values bring to companies that live by them
Greater efficiency
Easier decision-making
Higher employee engagement
Stronger relationships among employees
Increased competitiveness
Attracting the right talent while repelling the wrong candidates
Improved perception of the company among clients and in the market
What form do corporate values take
Written down – clearly documented corporate values reflect the rules of the game, but not everything written in manuals or posted on the walls reflects reality. EXAMPLE: a company displays the value "Client first" all over its walls, but in reality, salespeople put the sales result first.
Customary – these don't have to be formalized anywhere, yet they take shape through repeated behavior and become lived, genuine reflections of the company. And a word of caution: they aren't always positive. EXAMPLE: the value "Respect" took hold in a company through the exemplary behavior of existing employees, shaping how newcomers behaved too, without ever being written down anywhere.
Aspirational – new values that capture the vision of the behavior needed to succeed in the current competitive environment. EXAMPLE: H&M's value of "Continuous improvement" is meant to inspire employees to keep pushing the boundaries of excellence, without ever settling.
How to create corporate values
To set corporate values correctly, you first need to have a clear sense of your mission and vision. That's the starting point.
Avoid generic, empty terms, or values that every company claims — like "collaboration" or "professionalism," which are expected as a baseline everywhere anyway. Values like these say nothing distinctive about a company and don't help set it apart.
These should be values you genuinely live by, not just wishful thinking or proclamations. If you're setting new values, they should be ones you'll actually live by and that point toward your future direction. EXAMPLE: if "Sustainability" is one of your values, you should genuinely act on it, not just use it to score PR points.
Be as specific as possible. It also helps to give clear examples of the right behavior. And for an even fuller picture, it's important to give examples of behavior that's not tolerated or acceptable. EXAMPLE: Adidas includes a fuller description alongside each value — for "TEAM PLAY," it adds: Win together. Work collaboratively and cultivate a shared mindset. And there are real examples from companies where overly individualistic behavior, winning at the expense of the team, led to an employee being let go for not respecting that value.
Corporate values can be gradually developed and clarified over time, as the company lives with them and as the environment around it changes and evolves. For example, a start-up begins with certain values, but as it grows and becomes a larger company, the requirements placed on its corporate values change along with it.
How to implement corporate values
It's not enough to just write them down or transplant them from a foreign headquarters — they need to come from within, and everyone needs to understand what's behind them and how to live up to them.
They need to become part of every employee's everyday life.
Managers are the key element for successfully embedding corporate values. Company leadership has to lead by example for everyone else.
From there, similar behavior needs to be reinforced among employees, including through benefits and a compensation system that supports it. A growing number of companies are factoring respect for corporate values into annual reviews, and more and more are tracking and regularly measuring internal NPS, using the results to inform employee bonuses.
But the most important thing is being able to clearly define behavior that won't be tolerated — for example, not hiring a candidate, letting an employee go, or declining a business partnership in cases where doing otherwise would go against the company's values.
Why employees don't live by corporate values
Managers preach one thing and do another – the value "Ownership" says everyone in the company should be able to take responsibility and follow through on tasks within their remit. But if an employee sees that managers themselves can't make decisions, avoid responsibility, leave tasks unfinished, and shift blame onto others, the employee loses any motivation to respect that value too.
Definitions that are too general – like "Do the right thing," where it's unclear what perspective to view it from, how it will be evaluated, or how anyone would recognize it in advance.
Lack of specificity – for example, a value like "Winning" would lack direction without further explanation, leaving employees unsure what's actually expected of them. A small tweak makes it much clearer: Winning with our customers, meaning customers are at the heart of everything we do.
Examples of corporate values
Kogi's values
USEFULNESS – the client is our judge
COURAGE – we're open and honest with each other and with clients, and we keep pushing forward
FUN – working at Kogi is a powerful experience
How to communicate corporate values
Flyers
Bulletin boards
Elevators
Website
Intranet
SharePoint
Screensavers
Walls
Videos
Podcasts
… by leading by example
Wondering whether your corporate values are set up right and actually support your business goals? We'd be happy to talk it through with you, no strings attached — get in touch.