Company Values
The core principles and beliefs that guide how an organization operates, makes decisions, and treats its people, customers, and stakeholders.
What Are Company Values?
Key Takeaways
- ✓Company values are the fundamental beliefs that guide behavior, decision-making, and priorities across an organization.
- ✓Effective values are specific, behavioral, and used as actual decision-making criteria, not generic platitudes that could apply to any company.
- ✓The gap between stated values and lived values is the single biggest source of employee cynicism about company culture.
- ✓Values work when they're embedded in hiring decisions, performance reviews, promotion criteria, and how leadership behaves during difficult moments.
- ✓Most companies have too many values (diluting focus) or too vague values ("integrity," "excellence") that don't differentiate or guide behavior.
Company values are the principles that tell employees what this organization stands for and how people are expected to behave. When done well, they're a practical decision-making tool. When done poorly, they're wall art that nobody reads. Here's the test: if an employee faces a tough decision with no clear policy to follow, do they reach for the values to guide them? If yes, your values are working. If they've never thought about the values, you have wall art. The problem isn't that organizations don't have values. It's that 89% of companies write values but only 23% of employees can name them (Gallup, 2024). That gap represents billions of dollars in misalignment. Values that exist only in the employee handbook and on the careers page serve no purpose. Patrick Lencioni wrote in 2002 that most corporate values statements are "bland, toothless, or just plain dishonest." Twenty-plus years later, the same criticism applies to most companies. The ones that get it right treat values as operating principles that have teeth: they guide who gets hired, who gets promoted, and who gets asked to leave.
What Makes Values Effective
There's a clear difference between values that drive behavior and values that collect dust. The distinction comes down to specificity and consequence.
Specific beats generic
"Integrity" means nothing as a value because no company would say they value dishonesty. It doesn't differentiate or guide behavior. Compare: "We choose transparency even when it's uncomfortable" (Bridgewater), "When in doubt, favor the customer" (Amazon's Customer Obsession), or "We are honest when it's hard" (Brene Brown's company). These are specific enough that you can observe whether someone is living them or not. The test for a good value: would the opposite of this value be a reasonable choice for a different company? If yes, it's specific enough. "Move fast and break things" (early Facebook) passes because a bank would reasonably choose the opposite.
Behavioral beats aspirational
Values should describe behaviors, not ideals. "Innovation" is an ideal. "We run experiments before building features" is a behavior. "Teamwork" is an ideal. "We won't ship a feature until the designer, engineer, and PM all agree" is a behavior. Behavioral values can be evaluated in performance reviews. You can observe whether someone is doing them. Aspirational values are too abstract to assess, which means they can't be enforced, which means they're optional.
Few beats many
Three to seven values is the sweet spot. Fewer than three and you're not providing enough guidance. More than seven and nobody can remember them. Netflix has 10, but they also wrote 125 pages explaining what each one means in practice. If you're not willing to do that, keep the list short. Every value you add dilutes the others. If everything is a priority, nothing is.
Company Values Examples That Work
These companies are often cited for having values that actually influence behavior, not just decorate walls.
| Company | Example Value | Why It Works | How It's Enforced |
|---|---|---|---|
| Netflix | "Freedom and Responsibility" | Specific tradeoff: you get autonomy, but you own the outcomes | No vacation tracking, no expense policies, but underperformers are let go quickly |
| Amazon | "Customer Obsession" | Clear priority: when in doubt, favor the customer over internal convenience | Every project starts with a press release written for the customer (working backwards) |
| Patagonia | "Build the best product, cause no unnecessary harm" | Sets a concrete standard that constrains product decisions | They've killed profitable product lines that didn't meet environmental standards |
| GitLab | "Transparency" (default to public) | Everything is public by default: handbook, strategy, metrics | All documentation is open-source; meetings are recorded and shared |
| HubSpot | "Autonomy with Accountability" | Balances freedom with ownership, preventing both micromanagement and chaos | Embedded in performance reviews: results matter more than hours worked |
How to Create Meaningful Company Values
Values creation is a strategic exercise, not a branding exercise. Involve the right people, ask the right questions, and test rigorously.
Involve employees, not just executives
Values created in a boardroom by six executives reflect what leadership wants the culture to be, not what it actually is. The best process includes employees from all levels and departments. Use focus groups, surveys, and workshops to identify the behaviors and beliefs that already make the company successful. Then distill those into 3-7 values. Values should describe the best of who you already are and who you commit to becoming, not a fantasy disconnected from reality.
Test with the "airport test" and the "firing test"
The airport test: if you met a stranger and described your company's values, would they say "that could be any company" or "that's distinctive"? If it's the former, your values are too generic. The firing test: would you fire a high performer who consistently violated this value? If the answer is no, it's not really a value; it's a preference. Netflix famously lets go of talented people who don't fit the culture. That's what makes their values real.
Define behaviors for each value
For every value, write 3-5 specific behaviors that demonstrate it and 2-3 behaviors that violate it. For example, if the value is "Radical Candor," demonstrating behaviors might include: giving direct feedback within 24 hours, sharing concerns in meetings rather than after them, and asking for feedback publicly. Violating behaviors: talking about people behind their back, agreeing in meetings and disagreeing in Slack, or giving only positive feedback to avoid discomfort. This makes values observable and reviewable.
Embedding Values in Daily Operations
Written values become real values only when they're woven into the systems that govern daily work. Here's how to make that happen.
- Hiring: Include values-based questions in every interview. "Tell me about a time you chose transparency even when it was uncomfortable." Score candidates on values fit alongside skills. Turn down talented candidates who don't align. This is the hardest and most important step.
- Onboarding: Dedicate time in the first week to explaining what each value means in practice. Use real stories from the company's history. Pair new hires with a "values buddy" who models the behaviors.
- Performance reviews: Add a values section to every review cycle. Rate employees on how well they demonstrate each value, with specific examples. Make values count for at least 30% of the overall assessment.
- Promotion criteria: Explicitly state that promotion requires both results and values alignment. Promoting someone who delivers results but violates values sends the loudest possible message that values are optional.
- Recognition: Tie peer recognition programs to specific values. "I'm recognizing Sarah for living our 'Customers First' value by staying late to resolve that billing issue." This makes values visible and celebrated.
- Decision-making: Reference values in leadership communications and decision explanations. "We chose Option B because it aligns with our commitment to transparency, even though Option A was cheaper." This shows values are real operating principles.
The Values Gap: Stated vs Lived
The distance between what companies say they value and what they actually reward is the root cause of most workplace cynicism.
Why the gap exists
Values are easy to write and hard to live. When revenue drops, the value of "employee wellbeing" conflicts with the pressure to cut costs. When a top salesperson harasses a colleague, "respect" conflicts with "hit the revenue target." The gap widens every time leadership chooses convenience over values. Over time, employees learn which values are real (the ones enforced under pressure) and which are decorative.
How to close the gap
First, measure it. Run a culture survey that compares employees' perception of lived values against the stated values. Ask: "On a scale of 1-5, how well does leadership model [value]?" and "How often do you see [value] practiced in your daily work?" Second, address the biggest gaps publicly. Say: "We scored 4.5 on customer focus but 2.8 on transparency. Here's our plan to close that gap." Third, hold leadership accountable first. The gap almost always starts at the top. If the executive team isn't modeling values, nobody below them will either.
Company Values Statistics [2026]
Data showing the impact of well-defined and well-practiced company values.
Values Anti-Patterns to Avoid
These mistakes are so common that they've become cliches. Avoiding them puts you ahead of most organizations.
- The laundry list: Having 12 values means having no values. Nobody can remember 12 things. If you can't cut the list to 7 or fewer, you haven't made hard choices about what matters most.
- The motherhood statement: "We value integrity, teamwork, and excellence." So does every other company on Earth. If your values could be swapped with a competitor's and nobody would notice, they're too generic to be useful.
- The aspiration trap: Writing values that describe who you want to be rather than who you are. "We move fast" doesn't work if your approval process has 8 layers. Start with the truth, then evolve.
- The poster problem: Printing values on posters and mugs but not building them into hiring, reviews, and promotions. Values that aren't enforced are fiction.
- The executive echo chamber: Creating values in a leadership offsite without employee input. The result reflects what executives wish the culture was, not what it actually is. Employees see through this instantly.
- The static value: Writing values once and never revisiting them. Companies evolve. A 500-person company has different needs than the 15-person startup that wrote the original values. Review and refresh every 3-5 years.
Frequently Asked Questions
How many company values should we have?
How often should values be updated?
What's the difference between company values and a mission statement?
Should values be the same for every department?
How do you handle employees who deliver results but violate values?
Written by Adithyan RK