There's been a lot of talk about values in the wake of recent corporate scandals, much of it highly sceptical. Enron, for example, was a member of Business for Social Responsibility, and posted its values - respect, integrity, communication, excellence - prominently on its website. You have to be irony-deficient not to get a laugh out of that.
The November issue of Harvard Business Review features research by professor Amy Edmondson, showing how a values-driven cul-ture can backfire. Edmondson tells the story of a boutique advertising agency built on its founder's belief in the importance of diversity, egalitarianism, and work-life balance.
That approach attracted a highly motivated workforce, and employees cited the company's values as one of the reasons they loved working there. But when asked to describe the worst things about the company, values came to the fore again, in unexpected ways.
When the founder chose to grow the company to provide opportunities for staff and deliver greater rewards to its profit-sharing participants, employees believed the plan was motivated by greed.
And when the founder gave four long-standing employees shares in the company, others saw it as a violation of the company's commitment to equality.
But those concerns were never voiced, leaving the agency founder unaware of any discontent.
It would be easy to conclude from recent coverage that values are either meaningless or potentially dangerous, as in this case study.
But the reality is that values are critical. They are key to sound business decision-making and to protecting the company's reputation.
However, values are effective only if applied effectively, and measured.
Companies that take values seriously need to gather feedback - particularly from employees, but also, when practical, from customers and investors and communities.
Three questions need to be asked of employees: Do you understand our values? Do you believe management is living up to those values? Do you believe you are empowered to put the values into action in your job?
Those three questions present the best defence a company can have against incurring unnecessary reputational risk or against charges of management hypocrisy.
Values are not just words on a piece of paper; they're the starting point for a continuous, never-ending dialogue.