In many businesses, regardless of the importance of the company’s brand or intellectual property, or even the magnitude of its fixed assets, it is often said that “the real assets go home every night.” Board oversight of a company’s human capital has steadily grown in importance, first with workplace safety issues and the #MeToo movement, and more recently with the heightening of social justice issues. The COVID pandemic and the ensuing “Great Resignation” have left many companies struggling to retain employees, and finding it even harder to attract new ones.
 
Shaara Roman’s The Conscious Workplace: Fortify Your Culture to Thrive in Any Crisis (Bedgebury Press, 2022) provides a valuable frame of reference to help board members better understand what their oversight of human capital entails. The book is written for corporate leaders rather than specifically for boards, but it illuminates ways for boards to understand, evaluate and support management’s efforts to protect and enhance this very valuable company asset, which of course doesn’t appear on the company’s balance sheet. 

There is much in the corporate governance press these days about ESG, with board members wrestling with how to incorporate the interests of stakeholders with shareholders. While Ms. Roman’s book may relate to the “S” in ESG, it is not a lofty and aspirational discourse about a company’s place in society. Rather, it is focused on the workplace. It provides down-to-earth and everyday observations and suggestions about how companies can make themselves stronger and more valuable.

The author demonstrates that while most company organizational cultures have developed organically, perhaps without much conscious design or even perception by management, there is a real opportunity for management to focus on culture as a key element of the company’s future and success. This sentiment echoes Peter Drucker’s oft-quoted pronouncement that “culture eats strategy for breakfast.”  

The book describes in considerable detail how management can better understand both the current and historical culture of the company, and especially to what culture ideals they might aspire and how those might be developed and supported. This book will enable board members to ask better questions of management and evaluate more effectively management’s plans and the execution thereof for strengthening the company’s workplace culture.

During a brief discussion I had with Roman, head of the organizational culture and leadership firm The Silverene Group and adjunct professor in Georgetown University’s HR management program, she detailed how companies like Chobani and Patagonia have embraced workplace ideals that would likely not have been prescribed had there been an exclusive pursuit of shareholder value, citing academic studies that demonstrate the value of such ideals in long-term company performance.
 
She mentioned a study by Gallup showing the decline in the number of highly engaged employees, a development that has been ongoing for some time and was accelerated by the pandemic. Roman also points to a study from Cornell University’s Emerging Markets Institute, which shows that in the first year of the pandemic, ESG funds rose between 27% and 55% while the S&P rose only 27%. And, as the market began to recover, traditional equity funds were down almost 9% while sustainable businesses were down only 4.8%. Roman therefore argues that company leaders must increase their consciousness of the workplace and the values and ideals that it exemplifies, while being proactive about creating a workplace that will serve the long-term value of the company by supporting its most valuable asset.

The Conscious Workplace: Fortify Your Culture to Thrive in Any Crisis is a must-read for directors who want to help their boards strengthen oversight of the company’s human capital and better support management’s efforts. 

Howard Brod Brownstein is president of The Brownstein Corporation, an M&A and turnaround management firm, and serves as an independent corporate board member for Merakey and P&F Industries Inc.