Cultural Sensitivity in Governance

Link Between Local Culture and Corporate Governance Corporate governance is often viewed through a standardized lens of best practices, but the local culture plays a critical role in shaping how these practices are implemented. A prime example of this is Japan’s approach to corporate governance, where the blend of traditional business culture and modern governance reforms offers key insights. Case Study: Japan’s Corporate Governance Code Reform In Japan, corporate governance has historically been influenced by the country’s cultural emphasis on consensus, loyalty, and long-term relationships. This led to a system where boards were often comprised of insiders, and decision-making was driven by harmony rather than challenging the status quo. However, in 2015, Japan introduced its Corporate Governance Code to promote more transparency, independent oversight, and shareholder rights. These reforms were designed to align Japanese companies with global standards while respecting the cultural nuances of Japanese business practices. Key Changes: Introduction of Independent Directors: Companies were encouraged to appoint independent directors to bring fresh perspectives and foster accountability. However, the challenge was integrating these directors into a culture that values consensus and group decision-making. Shareholder Empowerment: Japanese firms are now required to disclose more information and engage with shareholders more proactively. This shift helped balance the traditional loyalty to internal stakeholders with the need for external oversight. The Cultural Balance What makes Japan’s case unique is the blend of global corporate governance principles with local cultural values. For example, while independent directors were introduced, many companies still place high importance on relationships and long-term commitments. The reforms pushed for transparency and accountability without completely dismantling the trust-based, collective decision-making approach that defines Japanese corporate culture. Closing Thoughts The intersection of local culture and corporate governance is a crucial consideration for any organization operating in or expanding into foreign markets. Leaders must understand how cultural values influence governance practices and adapt accordingly. Japan’s experience shows that governance reforms can succeed when they are tailored to fit local business customs, rather than forcing a one-size-fits-all model. #CorporateGovernance #GlobalBusiness #Leadership #CultureAndGovernance #JapanCaseStudy #Sustainability Image Source : Pixabay

A board chair once shared with me that a director they worked with rarely spoke during meetings. What was thought to be disengagement was, in fact, something far more meaningful. That truth only emerged when we took the time to listen to this “quiet” director.   The director, who is Indigenous, explained that when presentations ended, the board would leap straight into debate and decision. There was no space for reflection. In this director’s ways of knowing and being, careful thought should be given not only to the voices of elders and community today, but also to the impact of every decision on the seven generations behind us and the seven generations yet to come.   Their silence was not disengagement. It was wisdom waiting for space.   What struck me most was that while the board was trying to incorporate Indigenous inclusion, it had not consciously created space for Indigenous perspectives. This is a powerful reminder that governance without true inclusion is incomplete.   Yesterday, on National Day for Truth and Reconciliation, I spent time in reflection, on what this means for boards across Canada:   Best Practices for Boards ✔️ Build in space for reflection and resist the rush from presentation to decision. ✔️ Acknowledge and integrate Indigenous ways of knowing and being, including Rights Holder engagement and long-term intergenerational impact. ✔️ Foster psychological safety so every director feels respected and heard. ✔️ Embed cultural safety and Indigenous-specific anti-racism into governance practices.   Remember: we are a mosaic of peoples, and true governance honours all perspectives. Good governance is not just about accountability and performance. It is about respect, cultural safety, and creating space for voices that have too often been left unheard. 🍁 ❤️ #TruthAndReconciliation #IndigenousGovernance #BoardLeadership #CulturalSafety

When Self-Interest Overrides Cultural Integrity: A First Nations Perspective on Board Conflicts By Nicole Brown On Day Two of the AICD course, the topic of failing to act in good faith sparked necessary reflection — especially when applied to the realities of First Nations governance. The reminder that “boards decide if conflicts exist” and that directors must “disclose any material interests” becomes even more complex in our communities, where kinship, culture, and politics are deeply interwoven. Let’s be clear: perception matters. In fact, in First Nations communities, perception can be just as powerful as the facts. Even when a director believes they’re acting appropriately, if their actions are perceived as self-serving or exclusive, trust can be lost in an instant. And in small communities where decisions echo loudly, perception is reality. In a good light, perception can uphold integrity — when a board is transparent, inclusive, and actively declares conflicts, it builds confidence. When mob can see that decisions are being made fairly, it fosters cultural safety and strengthens the legitimacy of the leadership. This is the power of perception used well: reinforcing accountability through visible action. But in a bad light, perception can destroy credibility. If a board refuses to acknowledge or record conflicts of interest — or worse, doesn’t even have a conflict of interest register — it gives the impression of secrecy and favouritism. Directors may think they’re just “helping out family,” but when they influence decisions that benefit their personal networks, the perception is one of corruption, even if it’s not illegal. That damage is long-lasting. Let’s not forget: people naturally look after their own self-interest. But governance isn’t about instincts — it’s about discipline. It’s about putting the interests of the whole community above individual or family gain. It’s about doing the right thing, even when no one is watching — and especially when everyone is. That’s why boards must go beyond compliance and foster a culture of transparency. That means: ☑️ Actively maintaining a living conflict of interest register ☑️ Discussing perceived conflicts, not just actual ones ☑️ Creating space for culturally safe disclosures ☑️ Recognising that perception alone can undermine the board’s credibility In First Nations governance, acting in good faith is about more than rules. It’s about relationship, responsibility, and respect. Perception, when managed with integrity, can be a powerful ally — but when ignored, it becomes a quiet storm that erodes the very foundations we stand on.

As I learn more about New Zealand’s approach to workplace investigations, I’ve been struck by how cultural sensitivities are not just best practice. They are formally recognized in law and professional guidance. Most investigators worldwide already aim to approach their work with cultural awareness. But in New Zealand, this responsibility has been taken a step further. The Employment Relations Authority (New Zealand’s specialist employment tribunal) and the Employment Court have acknowledged the relevance of tikanga Māori, the system of Māori customs, values, and cultural practices, in how employment disputes and investigations are conducted. For practitioners, this means cultural awareness is not simply a matter of discretion or good judgment. It is a professional and legal expectation. In practice, that can affect how interviews are run, whether whānau (family) support is welcomed, or how different communication styles are understood and assessed. The underlying principle is clear: fairness is not only about procedural correctness. It is about ensuring people feel heard and respected within their own cultural context. There is much here for the global investigations community to reflect on and to learn from.

I'm incredibly proud to have co-written a new policy brief, "Inclusive and Secure Artificial Intelligence," with the brilliant Liliana Pinto. 📝 This was a true labor of love, and I'm grateful to the ifa (Institut für Auslandsbeziehungen) for the invitation to work on this improtant project. Our report dives into a topic that's often overlooked in the AI discourse: cultural dynamics. 🎨 While the conversation around AI ethics has focused on things like technical fairness and privacy, we argue that AI systems are not neutral. In fact, they often reflect and reinforce dominant cultural norms, frequently those of the Global North, marginalizing communities in the Global South whose languages and experiences are underrepresented in training data. 🗣️ We explored how this bias shows up in the real world: Facial Recognition: Many systems have higher error rates for individuals with darker skin tones, a direct result of training data that lacks diversity. 🧑🏿🦱 Natural Language Processing (NLP): Tools like Google Translate and ChatGPT struggle with non-Western languages and Indigenous dialects, perpetuating linguistic dominance. 🗣️ Hiring Algorithms: Automated systems can disadvantage women and people of color by penalizing resumes that reference women's colleges or by relying on biased historical data. 👩🏾💼 But this isn't just a critique; it's a call to action. We offer a practical policy toolkit to embed cultural awareness into the entire AI lifecycle. This includes: 🔨 Cultural Impact Assessments: Similar to environmental impact reports, these assessments would proactively identify and mitigate potential harms to a community's norms, values, traditions, and languages before an AI system is deployed. ✅ 🔨 Participatory Governance: We advocate for involving affected communities directly in the design and oversight of AI systems to ensure they reflect diverse perspectives from the outset. 💬 🔨 Strengthened Partnerships: We recommend building strong collaborations between the public sector, private companies, and civil society to create shared standards and enforceable regulations. 🔗 This report is about a fundamental shift: from reactive bias mitigation to active harm prevention. To build a truly ethical and responsible AI future, we must embrace cultural diversity not as an afterthought but as a core condition for success. ✨ Find the full policy brief in the comments! Thanks to everyone who also took part in our culturally aware AI workshops and helped to co-create this policy brief. It really takes a village to create culturally aware AI. Thank you Ivana Putri + Sarah W. for the opportunity. Thank you Wanda Muñoz for sharing these opportunities! Widmaier@ifa.de #AI #TechEthics #Inclusion #Diversity #CulturalRelations #ResponsibleAI #GlobalSouth #Policy #TechForGood