The Power of a Positive Culture

Senior management “cannot anticipate every problem,” Jacob Rosengarten points out. That is where a well-functioning corporate culture, relying on the observations and actions of “people who are closer to the problem,” proves its worth.

“Great cultures need that,” he says. And those cultures need to be nurtured.

Rosengarten, a principal of Wolf/Rosengarten Group and former chief enterprise risk officer of XL Group, speaks of his experience with “culture carriers,” referred to internally as managing directors and working to “deliver culture across the organization.”

“If they saw something that needed fixing, they voluntarily assembled, got the right people involved, fixed it, and then disassembled,” explains Rosengarten, an enterprise risk management specialist who delivered an Ideas That Count presentation at GARP's 20th Risk Convention last February.

“They ran to trouble - went to where the problems were” and inspired more-junior people in the process, Rosengarten says in the video that is part of a GARP series of risk leadership interviews.

He believes that successful cultures operate and solve problems at faster speeds than others do, fueled by mutual trust and fewer bureaucratic obstacles.

Culture becomes especially critical in a period of rapid change and innovation.

“I would argue that controls always follow after innovation,” Rosengarten says. “For example, Henry Ford develops the automobile. Later on, somebody develops the traffic light. Somebody else develops insurance policies, the speed limit policy, and all the rest.

“We are going through the same thing in our world. There is lots of innovation, and controls are not fully up to it yet. Great cultures will know on their own which problems to get in front of, and they will handle it in a more aggressive and proper way, as opposed to waiting for the control to be in place and then resolving it. They will anticipate the problem. They'll be more resilient and more dynamic. That is why strong cultures tend to be more profitable and, frankly, more fun to work at.”

For the previous interview in the Insights from Risk Leaders series, with BNP Paribas group chief risk officer Frank Roncey, click here.

Video production by DeLisa White