Wells Fargo has long had a reputation for sound management. Wells Fargo Culture, Values, and Management The tensions between corporate culture, financial incentives, and employee conduct is illustrated by the Wells Fargo cross-selling scandal. Graham, Harvey, Popadak, and Rajgopal (2016) find evidence that governance practices and financial incentives can reinforce culture however, they also find that incentives can work in opposition to culture, particularly when they “reward employees for achieving a metric without regard to the actions they took to achieve that metric.” According to a participant in their study, “People invariably will do what you pay them to do even when you’re saying something different.”

While corporate leaders and outside observers contend that culture is a critical contributor to employee engagement, motivation, and performance, the nature of this relationship and the mechanisms for instilling the desired values in employee conduct is not well understood.įor example, a survey by Deloitte finds that 94 percent of executives believe that workplace culture is important to business success, and 62 percent believe that “clearly defined and communicated core values and beliefs” are important. They altered customers’ contact information in order to prevent the victims from learning what happened.Recently, attention has been paid to corporate culture, “tone at the top,” and the impact that these have on organizational outcomes. Employees forged signatures to open accounts, created PINs to activate unauthorized debit cards and moved millions of accounts. Its community banks’ “onerous sales goals” and pressure from management pushed thousands of employees to engage in the illegal conduct that included fraud, identity theft and the falsification of bank records, in addition to generally unethical selling practices.Įmployees would “game” the numbers by using customers’ identities without consent to open checking, savings, debit card, credit card and other accounts, the bank admitted. “This settlement holds Wells Fargo accountable for tolerating fraudulent conduct that is remarkable both for its duration and scope, and for its blatant disregard of customer’s private information,” Granston said in a written statement.Ī focus on increasing sales volume and annual sales growth pressured employees to sell existing customers on new financial products, Wells Fargo admitted.

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