How Leadership Behaviour Shapes Company Culture

How Leadership Behaviour Shapes Company Culture

Culture cannot be applied to an organisation from afar as a by-product or afterthought. Nor can it be dictated by management. Instead, it’s learned behaviour.

A workplace’s culture is shaped by the way its people interact with one another, and every employee has influence. Unsurprisingly, though, it’s the behaviour of those in leadership positions that have the biggest impact. Therefore, to drive a cultural change in the workplace, the behaviour of those within the organisation, and especially its leadership, must change first.

Leadership behaviours which might influence culture include using company values and principles as a guide for their own actions and choices, collaborating with others, communicating cultural values to staff and contributing to the overall mission of the company.

The first step for any leader looking to improve the workplace culture is to determine the values that reflect the company. If these aren’t already clearly defined, taking time to create a consensus is immensely valuable. It provides a roadmap and an underpinning for executive decisions, which can be communicated to the workplace as a whole.

Once you have a handle on your values, think about how concrete behaviours reflect those values. The same values will look different in action in different companies, depending on their mission and scope. For example, being ‘customer-centric’ might see a retailer offer free add-ons, while a law firm might demonstrate it in their timeliness and communication skills.

Some cultural values transcend almost every industry, and while they look different in action, leaders can affect them in similar ways.


Everyone wants to be innovative, both to ensure continued growth and to ward off potential disruptors. But creating a truly innovative culture requires more than just announcing that you welcome ideas. It means that leaders need to be willing to have open and honest discussions about what makes a great idea, and must accept that failure is part of the deal.

When leaders come down hard on perceived mistakes, it creates a culture in which people become too afraid to put new ideas forward. This also extends to mistakes that the leaders themselves make. It can be tempting, as the head of a business, to portray an impression that you are infallible. But in fact, being willing to admit your own mistakes is a way of role modelling the same acceptance for others, and thus fostering innovation.

Look at your promotion and reward structure, as well: do you have a way to recognise people who have tried to come up with solutions, even if they’ve fallen short?

Read more: How Your Workplace Should Approach Innovation

Change management

Companies can find it hard to embrace change, but the way in which leaders approach it will set the tone for the rest of the business. If leadership is either openly dubious about upcoming changes, or reluctant to explain them, it can cement the wariness of their employees.

As a leader, make sure that you clarify the vision that underpins the changes and communicate that effectively. Understanding the ‘why’ behind the ‘what’ helps to bring your staff along with you. This is true whether the change is relatively mundane, pertaining to the day-to-day, or a sweeping change in the direction of the company.

Also read: 7 Key Factors for Successful Change Management


Transparency underpins every effective cultural change and is a valuable component of company culture in its own right. When leaders show their people the respect of bringing them along on the journey, those people respond.

A culture of transparency starts with leadership but is most valuable when it’s reflected at every level. You want to know that your staff are being open about challenges as well as victories, for one thing. That way, you’ll be able to tell what your team are thinking, whether there are problems that need addressing and whether they’re aligned with the company’s direction.

Transparency also goes hand in hand with accountability. Leaders who are accountable are willing to let their staff see the processes behind the results, admit to their own challenges and assess how successful a project has been. They look at every aspect of the company to ensure that it’s functioning well, and take action when it is not.

Also read: The Characteristics of a Truly Influential Leader


Respect must be modelled from the top down, and it takes many forms. Some of those are contained within the principles discussed above, including transparency and value for innovative ideas. But respect can also be modelled in simpler ways, including how people are addressed and who is given airtime.

The ways in which leaders treat their time and the time of their staff is another form of respect and a cultural value that flows through to the entire group. When leaders are habitually late to meetings, leaving everyone else waiting to start, it communicates a disrespect for their time. That behaviour may then be adopted by employees, who could stop taking start times seriously.

Similarly, an office in which leaders take a long time to respond to feedback or queries is one in which employees will feel disrespected. While there will always be allowances made for senior management who juggle multiple responsibilities, the ways in which communication is handled can be an issue. Whichever way they’re handled will become part of the company’s values and disseminated through the workforce.

Read more on the topic: Company Culture: Why It’s Important and How to Build It

Keen to learn more about leadership behaviour and practices? Watch this sneak peek into the leadership course with AIB. 

This article was written by Tanya Ashworth-Keppel on behalf of the Australian Institute of Business. All opinions are that of the writer and do not necessarily reflect the opinion of AIB. The following sources were used to compile this article: Forbes, Quartz, Business News Daily and Harvard Business Review.

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