The Accountant-Jan-Feb 2017

Governance
IMPORTANCE
OF CORE VALUES
IN AN ORGANIZATION’S
CORPORATE STATEMENT
‘‘It is the stone that the builder refused to accept, which
has become the most important stone’ 1 Peter 2:7
(Psalm118:22), ‘the stone that the builders
rejected became the cornerstone’
By Felix Owaga Okatch, okatchfelix@gmail.com
Across the world institutions,
organizations and
corporations have come
up with core value
statements that show
what they are and how they
plan to achieve their goals and
objectives in the short and long
run. That is achieving their goals
over time despite global and local
challenges. They consolidate their
energies through their respective
core values and expect stakeholders
to perceive them favourably.
This is done through developing an
organization’s core values. This is what
an organization stands to achieve. It is
akin to the foundation stone for a builder.
In building construction industry, laying a
foundation is usually the starting point. If it
is not done right at the start the building is
bound to fall in future or lean precariously
like the Leaning Tower of Pisa in Italy.
When developing core values, the
number should not be many lest they
become just general words and statements.
In most cases the numbers of core values
range from eight to three. Generally an
average of five is sufficient.
We now need to address four aspects of
core values for organizations to elucidate
our understanding of the same. This calls
for our understanding of what core values
are and their meanings. We also need to
comprehend how core values are developed
as
well.
As we do
so we shall
take into account how the core values
are used by institutions and conclude by
illustrating the expected results and way
forward after developing core values for an
organization.
Now for a start we need to elaborate
why this core value analysis is important.
Core values at the start are the prologue
and a binito of company analysis of
direction to its goals in business. It is
the second step of corporate or company
vision and mission statements. It puts in
place thoughts of employees, management
and board and the goal congruence of an
organization’s strategic direction. Since it
is developed by all, it gives direction and
communication within and outside
the organization. Core values assist
the organization to move towards
a strategic goal post. Without
asserting energies and values
towards a strategic direction, an
organization is bound to fail.
Core values do assist in creating
a value statement that must be
owned by all. Core values when
known by all staff and owned by
many will guide the organization
from engaging in diversionary
environmental temptations and
distractions. It is important to ensure
that boards, management and staff are
able to get involved jointly and severally
in preparation and ownership of company
core values.
Let us now explain how core values should
to be used by organizations;
All employees, staff, management, and
the board need to be disciplined to focus
on core values. Since all were involved in
developing the core values, there needs
to be focus and attention to the success
of achieving the objectives of core values.
Generally the core values need to be less
than five and easy for company internal
users to internalize. The staff must know
that core values are important and depict
what an organization cannot do without.
It must be noted that it takes time to
36 JANUARY - FEBRUARY 2017