Whilst the tone of leadership, corporate values and ethics, risk appetite and the type of incentives are important, risk culture is ultimately a local construct. It is driven by social factors, which means people are mainly influenced by the colleagues they interact with every day. These local influencers can be people they like and trust or people they fear due to pressure and bullying.
This is known as Social Learning, and it is how knowledge becomes habit and how behaviour becomes ingrained. Social Learning influencers are ‘Culture Carriers’. They exert an immense level of positive or negative impact on local workplace culture and conduct. However, they are not always recognisable.
At Blackhall & Pearl, our Risk Culture model, Quantum-iQ, assesses, aligns, shapes, benchmarks, predicts and monitors group risk culture and individual conduct. From the boardroom to the storeroom.
Risk Culture Carriers are not necessarily senior management or internal risk experts.
They are work colleagues that function through informal networks. These invisible networks account for up to 70% of an organisation’s total knowledge and behaviour flow.
Identifying these invisible networks and the Risk Culture Carriers that are positively or negatively influencing their peers enables the organisation to significantly shape and ingrain desirable risk culture.
This is achieved through Social Network Analysis (SNA). SNA reveals the hidden social networks within the organisation and identifies the key influencers of culture at the local business unit level.
More importantly, SNA determines whether that influence is being exercised positively or negatively and enables the shaping of that influence to substantially shape and ingrain the desirable standard of behaviour at the local business unit level.
Our Quantum-iQ model expedites local behavioural change up to 8 times faster than traditional change methods and in a much more permanent manner.
We also provide a comprehensive suite of predictive Risk Culture Indicators to proactively monitor and report on enterprise risk culture.
A sample of the risk culture environment our indicators monitor includes: