What Are Organizational Values? Definition, Importance & Examples
Organizational values are like the ingredients of a great recipe. And just like every chef has their way of putting those ingredients together to create their signature dish, every company also has its way of bringing its core values to life to create business success.
Organizational values impact every aspect of a company, including how it does business, makes decisions, and treats its employees and customers. Let’s examine organizational values, their importance, some inspiring examples, and how to define and live by them.
Contents
What are organizational values?
Importance of organizational values
Organizational values examples
How to define and integrate your organizational values
How to embed organizational values into your company culture
5 tips for writing your value statement
What are organizational values?
Organizational values are the guiding principles that provide an organization with purpose and direction. They are like a compass steering the company’s journey, shaping its decision-making, and defining its identity, both internally and externally.
Implementing and communicating organizational values can help companies attract and hire the right people, gain employee buy-in, and ensure their employees know how to best support the business strategy and achieve business success.
HR is well-positioned to identify, understand, and align the organization’s core values with those of its employees, make sure they are lived on a daily basis, and foster the type of organizational culture that supports them.
Importance of organizational values
As mentioned at the beginning of this article, organizational values impact every aspect of a company, including its decision-making and how it treats its people. Let’s examine their importance in more detail now.
Organizational values help a company:
Differentiate itself from its competitors
Your company values distinguish you from other companies in the eyes of your customers, business partners, employees, and candidates. As such, they are an essential part of your company culture, often also described as your organization’s personality.
Guide its employees in their decision-making
Values can clearly guide your employees’ actions in various situations within the company.
For example, the video conferencing company Whereby has an organizational value called ‘Trust trust.’ It means that people should be trusted from day one and don’t need to earn that trust.
As they put it themselves, ‘people start with a full tank of trust. This means trusting their expertise and skills, judgment, and intentions.’ This can be particularly relevant for managers when they welcome new hires.
Boost its chances of attracting, recruiting, and retaining top talent
Candidates are attracted to values they identify with. Clearly defined organizational values, reflected in your employer branding efforts and throughout your recruiting process, help ensure culture fit.
This fit goes both ways: As a company, you can assess whether or not a candidate would match your culture, and as an applicant, you can do the same thing. As a result, candidates will experience a certain level of self-selection, and some will decide that your company isn’t for them.
For fast-growing scale-ups in particular, their company values can be the thing that brings in top talent, especially since they can’t always compete with the ‘big guys’ on things like compensation and benefits.
Increase the likelihood of attracting customers with the same values
Sometimes, stats speak louder than words. This certainly seems to be the case regarding people’s values and purchasing preferences.
About 70% of U.S. consumers prefer buying from brands that share their values and ideologies. Data from a recent Ipsos report shows that about 20% of consumers have stopped using a company’s products or services because they did not reflect their values.
Inform its business strategy
Just like your core values guide your employees in their decision-making, they also guide the direction you want to go in as a company and how. Ultimately, this contributes to the success of your organization’s business.
Another example from Whereby: “Our values help us pinpoint tools that help us outwit and outgrit to make our work better — whether that’s more efficient, more human, or more accurate. They also help us decide if platforms, tools, and partners align with our goals.”
Boost employee engagement and motivation
The Employee Happiness Model outlines 15 universal drivers of engagement, grouped under four pillars: the organization, the people, the job, and wellbeing.
Within the organization pillar, one key driver is a company’s vision and values. Engagement increases when employees:
- Understand the company’s vision and values
- Identify with them
- See those values reflected in everyday behavior.
People feel more connected and motivated at work when values are clear, authentic, and consistently reinforced.
Take Whereby, for example. They’ve built their culture around what they call the Whereby ETHOS:
- Ethically ambitious: Committed to doing what’s right in ways that are real and visible.
- Trust trust: Trust is given by default, not earned over time.
- Human first: People are supported as whole individuals.
- Outwit and outgrit: Creative problem-solving with persistence.
- Selfishly diverse: Diversity is both a moral responsibility and a strength.
It’s a clear, values-driven approach that helps employees feel aligned with the company’s purpose.
Organizational values and culture shape behaviors, guide decision-making and influence long-term success. Bringing these into action requires skills in organizational development and change management.
AIHR’s Organizational Development Certificate Program equips you to lead change and build a high-performance culture to drive lasting impact.
Organizational values examples
We’ve already seen a few examples of organizational culture values from Whereby, but many others exist. And while values are unique to every organization, there are a couple of themes they often revolve around, such as:
- Integrity
- Innovation
- Collaboration
- Teamwork
- Passion.
Here’s a small sample of organizational values from companies all over the world.
Lululemon
Lululemon is a Canadian athletic attire retailer with its headquarters in Vancouver. The company’s mission is to ‘elevate human potential by helping people feel their best.’ They aim to do that by ‘creating transformative products and experiences that build meaningful connections, unlocking greater possibility for all.’
Lululemon’s mission and vision are clearly reflected in the company’s organizational core values:
- Personal responsibility
- Connection
- Inclusion
- Courage
- Fun.
Netflix
Netflix is known to truly live and breathe its organizational values (you can take a look at its culture deck here if you like). As such, the company reinforces its values in hiring, 360 reviews, compensation reviews, and other people processes.
Here’s an example of what that looks like when it comes to, for instance, high performance. Netflix wants stars in every position. To ensure this, managers use the so-called Keepers Test. In short, this means that they ask themselves which of their people they would fight hard to keep if they told them they would leave — a practice that is in line with both the company’s ‘courage’ and ‘honesty’ values.
The same goes for employees. They are encouraged to (be brave and) ask their manager from time to time how hard they would fight to keep them at Netflix.
Calm
Mindfulness company Calm is on a mission to support everyone on every step of their mental health journey. Its values describe how the company intends to achieve this.
‘Relentless,’ for example, means that they understand that speed matters but also that they move fast without breaking things. ‘Teamwork’ signifies understanding that great teams need safety, clarity, meaning, dependability, and impact.
Buffer
Another great example comes from Buffer. The social media management tool company has 10 core values, including one that is called ‘Default to Transparency.’ To try and live up to this particular value, they have made several things completely transparent:
- Salaries
- All of their code is open-source
- Their product roadmap
- All their diversity and inclusion data is public.
How to define and integrate your organizational values
Here are seven questions HR professionals can consider when defining organizational values and ensuring that employees are living them:
1. What’s the purpose of your organization?
As we’ve seen in the examples in the previous section, once you know your organization’s mission and vision, it becomes easier to define the values that will help you achieve those goals.
At the Academy to Innovate HR (AIHR), for example, we are on a mission to empower HR to create a better world of work.
To achieve our mission, we defined five core values that will help us get there — more on those below.
2. How do you want the world to see you?
This comes down to what matters most to you as an organization. How do you want your customers, employees, candidates, suppliers, and other stakeholders to see your organization?
To figure that out, it can be helpful to start by asking your current workforce what core values your company already has in place according to them.
At Buffer, they sent out a simple survey to their people to formalize what was already there. You can see what their survey looked like here.
3. How will these values be reflected and built into your processes?
Organizational values are the guiding principles of how your organization operates. But how does this look in practice?
Over at Whereby, they describe how they apply their core values when developing their internal processes and tools: “We launched our Progression Framework earlier this year to align the team on levels, skill sets, values, and more. Tools designed to guide team members through this process map to our values, helping team members assess their own performance and goals. And being transparent with our reviews ensures every team member understands where they’re at currently and what it takes to progress in their career at Whereby.”
4. What behaviors will represent your values?
It’s important to consider your core values regarding workplace behaviors to ensure they come to life.
At AIHR, we held a series of values workshops with the entire company. Each organizational values exercise evolved around one of our core values: Ownership, Excellence, Data-driven, Trust, and Hunger to Grow.
In small groups of around six people, we discussed the following questions regarding a particular value:
- What does this value mean to you?
- What are examples of behavior that demonstrate this?
- How can we, as AIHR, encourage this behavior?
Doing this kind of exercise is an excellent way to:
- Get employee input and create a rich definition of what each core value means
- Recognize and appreciate people in the organization who already live the company values and share real-life examples
- Collectively, think about how the company can encourage the embodiment of the organizational values (in that regard, employee recognition plays an important role).
5. How are you going to communicate your organizational values?
Once you’ve defined your values, you need to communicate them both internally and externally. How will you ensure they’re not just empty words written on a (virtual) wall or in a value statement?
Depending on the employee life cycle stage, there are various ways to approach this. During the attraction and recruitment phase, for example, you can communicate your values in your employer branding activities: on your careers page, on your ‘About us’ page, on the products you sell, and in employee testimonials.
A simple yet effective way to continuously highlight your company values internally is to briefly mention them in your company or team meetings.
This can, for instance, be a company stand-up in which a few employees who showed, in the case of AIHR, great Ownership or Hunger to Grow are being praised.
Another way to communicate your organizational values can be through peer recognition: employees and managers compliment each other for a job well done and for genuinely living by one or more of the company values.
Peer recognition and appreciation can take many forms, both online and offline. But linking it to something visible, like a virtual badge, award, physical post-it note, or even a postcard, has the advantage of letting people see that your values are ‘alive’ inside the organization.
6. How are you going to formalize your values?
Communicating and formalizing your values are two things that go hand in hand. One way to do this is by using a concise values statement.
Another interesting way to formalize your values – and encourage your employees to live by them – is to performance manage against them.
For example, at digital financial services company Zip, employee performance is assessed based on the ‘How’ and the ‘What.’ The ‘What’ represents 50% and is about what you’ve done: the number of sales you made, the code you wrote, etc. The ‘How’ represents the other 50% and is about how aligned the way you work is with the company values, how you’ve changed the game, how you’ve supported your colleagues, or how you owned a problem.
7. How will you keep your values relevant as your organization evolves?
Organizational values are constantly evolving. Just like the environment in which your business operates, the people who work for your company, and your organization itself.
Therefore, it’s good to monitor your core values. Take time to reflect on them regularly and collect feedback from your employees and perhaps other stakeholders.
Changes in organizational values can be subtle. Buffer, for instance, initially included ‘Communicate with clarity’ on its list of organizational values. After a company-wide effort to review the company values, this became ‘Have a bias towards clarity’ because it better reflected the organization’s direction and what it wanted to achieve at that point in time.
How to embed organizational values into your company culture
Here are a few simple tips for HR professionals looking to embed organizational values into the company culture, based on those mentioned above:
- Recognize and reward value-driven behavior: Go beyond results—consider evaluating employees partly on how they work, not just what they deliver. For example, if collaboration is a core value, recognize team members who actively support others and work well across departments.
- Model values through leadership: Employees take cues from their leaders. Managers and executives should consistently demonstrate the company’s values through their decisions, communication, and behavior. It’s not enough to endorse values—leaders need to live them.
- Integrate values into daily operations and decision-making: Values should show up in how decisions get made—from strategic choices to everyday trade-offs. For example, if transparency is a core value, that might mean sharing context behind leadership decisions, even when it’s uncomfortable. If customer focus is central, teams might prioritize long-term trust over short-term wins. Look for ways to apply values in hiring, feedback conversations, budgeting, and even which projects get the green light. Embedding values into decision-making makes them real—not just aspirational.
5 tips for writing your value statement
Many organizations formalize their values in a brief declaration, the value statement. Here are some considerations for writing it:
- Make it actionable: Values should guide behavior, not just sit on a website or an office wall. Use language that helps employees understand how to live the values daily. For example, instead of just “Integrity,” say, “We always do what’s right, even when no one is watching.”
- Keep each statement short and memorable: A strong value statement should be easy to recall. Aim for one sentence per value or a short phrase plus an explanation. For example: Collaboration — we win together by supporting and respecting each other.
- Make it unique to your company: Avoid generic phrases like “Excellence” or “Respect” without context. Tie values to your mission and industry — what makes your culture stand out? For example, a tech company might say, “We experiment, fail fast, and learn even faster.”
- Balance inspiration with practicality: Values should be aspirational but achievable — not so lofty that employees feel disconnected from them.
For example, instead of “We are the best in everything we do,” a more practical approach could be: “We strive for excellence by always improving and learning.” - Test it with employees before finalizing: Share drafts with employees and leaders to ensure the values resonate. Ask: Does this feel true to our company? Can you see yourself applying this in your daily work?
On a final note
Organizational values can be a great way to give your organization and its people purpose and direction, both long-term and in their everyday interactions and activities.
Equally important to defining your shared values is determining how you will bring those values to life in your (HR) processes. For this to be successful, it should be a continuous, collaborative effort involving your employees.
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