For many years, business publications and research organizations have put out “best employer” lists, ranking organizations based on their employees’ reported job satisfaction, the quantity and quality of their benefits, learning opportunities, and other selling points of the employee experience. These lists offer employers an opportunity to earn some good press and burnish their employer brand, and can be particularly valuable in helping lesser-known companies get their names out there and compete for talent with their higher-profile peers. These lists are typically opt-in: Employers that have good stories to tell submit their information, the top ten or 20 of them get a brand boost, and the rest don’t need to tell anyone they didn’t make the cut.
With more information about organizations’ talent policies becoming publicly available, these lists have evolved to draw on new sources of information and to focus on issues of increasing importance to employees today, like diversity and inclusion or corporate social responsibility. Glassdoor, for example, puts out an annual list of best places to work based on employee ratings and reviews, while Forbes and the activist investment firm Just Capital have begun publishing a “Just 100” ranking of the most socially responsible publicly-traded companies in the US and Bloomberg’s Gender Equality Index highlights companies that are investing in gender equality. The proliferation of best-of lists, however, has led to diminishing returns in their reputational value: Our research at Gartner has found that only 7 percent of candidates say being on one of these lists was an important factor for them in deciding whether to accept an offer from an employer.
The Lists Organizations Don’t Want to Be On
At the same time as the value of a spot on the nice list is waning, a growing trove of publicly available data has led to the emergence of new lists on which employers didn’t ask to be included. Some of these are extensive indices that identify both the best and the worst, like FertilityIQ’s Family Builder Workplace Index, which ranks employers based on the generosity of their fertility benefits. In some rankings, even the best-scoring companies are not great: Equileap recently published a special report on gender equality in the S&P 100, in which the highest grade was a B+. Furthermore, investors, governments, and media outlets have begun to compile what we might call “naughty lists” of companies that are not living up to expectations in terms of fairness, inclusion, transparency, or social responsibility — and you really don’t want to see your organization’s name on one of those.
These naughty lists tend to focus on gender pay equity, executive compensation, handling of sexual harassment claims, and the experiences of diverse employees. One recent, prominent example was a BuzzFeed report in November that pressed leading US tech companies on whether they required employees to resolve sexual harassment claims in private arbitration and called out those that did have such policies or declined to answer (Ironically, the reporters also discovered that BuzzFeed had a mandatory arbitration policy itself). The publication of this report prompted several companies to announce changes in their policies.
Uber announced on Tuesday that it would no longer require employees, drivers, or customers who experience sexual harassment on the job or while using the ride-sharing service to adjudicate their claims in arbitration proceedings. Coming in response to pressure from former employees and customers, the change will allow alleged victims of sexual harassment in the US to pursue claims against the company in court. Uber will also no longer bind accusers to confidentiality requirements as a condition of receiving a settlement on the company, though it will continue to keep financial details of such settlements confidential.
In a blog post, Uber’s Chief Legal Officer Tony West said the company would also publish a public safety transparency report including data on sexual assaults and other incidents that take place on its platform.
Hours after Uber’s announcement, Lyft also announced that it was waiving its standard arbitration agreement for sexual assault claims and would no longer impose confidentiality requirements on alleged victims of sex crimes, Recode’s Johana Bhuiyan reported later on Tuesday. Lyft also intends to release a safety report on sexual assault complaints it receives on its platform; Lyft COO Jon McNeil wrote on Twitter later Tuesday afternoon that his company would be happy to work together with Uber on this reporting project.
West said Uber had made its decision in the interest of transparency, but also acknowledged the risk the company was taking in being more open about these allegations (albeit a risk mitigated to some extent by the participation of its chief competitor):
In response to a wave of sexual harassment and misconduct allegations in recent months that has led eight members of the US Congress to either resign or decline to run for re-election, the House of Representatives voted on Tuesday to bar its members from engaging in sexual relationships with their employees and from using taxpayer funds to settle harassment suits, the Washington Post reports:
H.R. 4924 alters the Congressional Accountability Act of 1995 to require members to reimburse the Treasury Department when they are involved in settlements; automatically refers cases that have settled to the House Ethics Committee; extends workplace protections to unpaid staffers, including interns; gives staffers the ability to file a lawsuit at the same time as they file a complaint; and improves record-keeping.
A separate resolution, House Resolution 724, requires each member of the House to adopt policies prohibiting harassment and discrimination; establishes the nonpartisan Office of Employee Advocacy to provide assistance to staffers with complaints; mandates that each member’s office certify it is not using its budget for workplace settlements; and prohibits sexual relationships between members and “any employee of the House that works under [their] supervision.”
The resolution passed on Tuesday should put a stop to the widely criticized practice of paying settlements to victims of sexual harassment in the House with taxpayer funds, the Associated Press explains:
TIME magazine revealed its Person of the Year this week, granting the distinction not to an individual but rather to a group of women it calls “the silence breakers,” who have spoken up against sexual harassment in their workplaces in recent months. This includes the women in entertainment, media, and technology who exposed prominent men in their industries as serial sexual abusers; as well as the vast numbers of women who came out around the world with personal stories of sexual harassment on social media through the #MeToo hashtag campaign.
The revelation of these women’s stories, along with the growing number of famous men who have been fired from their jobs and publicly disgraced due to sexual misconduct allegations, has engendered a palpable shift in the way we as a society talk about sexual harassment and assault in the workplace. The shocking revelations of decades of sexual misconduct by Hollywood producer Harvey Weinstein in October may have been the event that triggered the avalanche of allegations and public admissions of guilt:
The response to the Weinstein allegations has shaped the way people view women who come forward. In a TIME/SurveyMonkey online poll of American adults conducted Nov. 28–30, 82% of respondents said women are more likely to speak out about harassment since the Weinstein allegations. Meanwhile, 85% say they believe the women making allegations of sexual harassment.
TIME also touches on the impact this conversation is having on gender relations in the workplace, noting that it is making men think harder (and feel some anxiety) about whether the interactions they have with their female colleagues are appropriate, and worry about crossing lines where they hadn’t before:
If Volkswagen’s emissions cheating scandal, Wells Fargo’s fake-accounts scandal, and Uber’s sexual harassment scandal have a common thread, it is that each of these controversies has been blamed on a fundamentally toxic element within the organizational cultures of these companies, so each company has embarked on a major culture overhaul in its wake. In a feature at the Wall Street Journal last week, Joann Lublin observed that scandals like these were opening directors’ eyes to how significantly their companies’ cultures affect their performance, and took a look at what some companies’ boards were doing to manage culture issues more directly.
Even though the evidence is mounting that culture problems can do severe damage to a company’s reputation and bottom line, “few boards currently have an explicit focus or formalized approach to cultural oversight,’’ Helene Gayle, who sits on the boards of Coca-Cola and Colgate-Palmolive, told Lublin. Gayle was the co-chair of a blue ribbon commission appointed by the National Association of Corporate Directors to prepare a report on culture as a corporate asset and come up with ideas for how boards can manage culture more effectively.
The report recommends that boards work with the CEO and senior management to “establish clarity on the foundational elements of values and culture,” and take a proactive approach to culture management. That means making oversight of culture (including the board’s own culture) a full-board responsibility. Culture management needs to be embedded in the organization’s business processes, including rewards systems and CEO selection and evaluation, and in the board’s interactions with management.
This recommendation concurs with the conclusions of our latest research on culture at CEB, now Gartner: Many organizations try to change their culture by changing their people, but these interventions are often ineffective, despite massive investments of time and resources. The most effective culture change efforts we’ve seen focus instead on crafting systems and processes that allow everyone to live the culture.
Volkswagen has been undergoing a massive process of cultural change since the 2015 emissions cheating scandal that cost the German automaker billions of dollars and severely damaged its reputation. Changing the culture of a huge company is no small feat, of course, and CEO Matthias Müller has spoken candidly about the challenges the company has faced in that process. In a recent interview with the Wall Street Journal’s William Boston, Müller touches on how the change is going.
The company now holds its board responsible for legal compliance and integrity, he tells the Journal, and has changed many of its processes. New board members are subject to compliance checks to ensure they are above suspicion, and the leadership is to engage more people in dialogue to build trust throughout the organization. Some of the changes involved in Volkswagen’s transformation have included replacing German with English as the language of business at large-scale management conferences and increasing the number of women in leadership positions.
A key challenge is repairing Volkswagen’s reputation, Müller explains, as parts of the company did indeed engage in criminal behavior, which casts a pall over the entire organization. That kind of damage can’t be repaired overnight. Large enterprises like his also have a tendency to move slowly, he acknowledges, but he would like to accelerate the pace of change as much as possible.
Volkswagen’s experience at carrying out a major culture overhaul in response to a crisis carries some lessons for other organizations, which overlap with some of the insights we at CEB (now Gartner) have uncovered in our research into the multifaceted challenge of culture change.
Google CEO Sundar Pichai canceled a town hall meeting he had scheduled for Thursday to discuss the issues raised by an employee’s controversial memo questioning the company’s diversity and inclusion initiatives, and the subsequent termination of the author of that memo, engineer James Damore. Pichai said he opted to cancel the meeting after questions intended for the meeting were leaked to the media and some Google employees’ names ended up on “alt-right” websites, resulting in them becoming targets of online harassment, Recode’s Kara Swisher reports:
“We had hoped to have a frank, open discussion today as we always do to bring us together and move forward. But our [internally submitted] questions appeared externally this afternoon, and on some websites Googlers are now being named personally,” wrote Pichai to employees. “Googlers are writing in, concerned about their safety and worried they may be ‘outed’ publicly for asking a question in the Town Hall.” …
Sources inside Google said some employees had begun to experience “doxxing” — online harassment that can take various forms and is defined as “searching for and publishing private or identifying information about [a particular individual] on the internet, typically with malicious intent.” Several sites … have been publishing internal discussion posts and giving out information on those employees.
“In recognition of Googlers’ concerns,” Pichai wrote in his announcement that the meeting was canceled, “we need to step back and create a better set of conditions for us to have the discussion. So in the coming days we will find several forums to gather and engage with Googlers, where people can feel comfortable to speak freely.”