CEO survey reveals culture is top driver of organisational value

A landmark study led by Te Kunenga ki Pūrehuroa Massey University and the Leadership and Governance Collective has revealed that while nearly all Chief Executive Officers (CEOs) believe organisational culture is a key driver of value, a majority say their current culture is not aligned with strategic goals.

The nationwide research, conducted by Massey Business School PhD candidate and Executive Director of the Collective Susanna Lee, surveyed CEOs and senior leaders from across the business, not-for-profit and public sectors. It offers a first-of-its-kind, data-driven look at the role of culture in shaping leadership decisions, employee engagement and long-term organisational success.

Ms Lee says the results show culture is no longer intangible – it’s a measurable asset with real commercial and social implications.

“These insights empower leaders to drive meaningful change and position culture as a core lever for strategy execution.”

Key findings

• 88 per cent of for-profit CEOs and 87 per cent of not-for-profit (NFP) leaders rank culture as one of the top three drivers of value
• 95 per cent of CEOs believe improving culture will boost firm performance through productivity, growth or profitability
• Despite this, 89 per cent of CEOs say their culture is not fully aligned with strategy, with more than half of these citing leadership bandwidth and capability as key barriers.

The study also shows that culture plays a defining role in mergers and acquisitions, with 44 per cent of for-profit leaders unwilling to buy a culturally misaligned company, and 59 per cent of not-for-profit CEOs saying they would walk away from such a deal altogether.

Key differences between for-profit and not-for-profit

One of the most striking contrasts lies in how culture is reinforced. While for-profit CEOs often use incentives to align behaviour, only 25 per cent of not-for-profits find incentives effective. Primarily, they say, because they are cost constrained and are unable to invest in incentive schemes in the same way, with 28 per cent saying they actively work against cultural alignment. Instead, not-for-profits focus on flexible working and values alignment to build and sustain culture on limited budgets.

• Flexible work arrangements are more common in NFPs, especially at leadership levels — a potential advantage in attracting and retaining diverse talent
• AI adoption is higher in for-profit firms (51 per cent) but growing in NFPs (27 per cent), with both sectors anticipating cultural shifts towards data-driven decision-making and improved collaboration.

Incentives and leadership signals

Despite the recognised importance of values, only 61 per cent of for-profit CEOs link discretionary pay to cultural behaviours, and just 28 per cent do so in not-for-profits. Many CEOs cite executive and employee behaviour as the most powerful cultural drivers, with governance systems and incentives playing a less consistent role.

The research, supported by an advisory board of CEOs, board members and academics, is part of an annual initiative to benchmark and improve organisational practices and performance nationwide. Partners include NZIER, BusinessNZ, LGNZ, Creative HQ, NZ Growth Capital Partners and Ākina. This first iteration of the survey received a total of 1,188 responses.

A customised dashboard of findings will be provided to participating organisations, with the goal of informing strategy, improving transparency and enabling leaders to share best practices.

“With just 15 minutes a year, CEOs can gain insights that enhance their organisations. This year’s data shows that investing in culture isn’t just good leadership, it’s strategic with real implications,” Ms Lee adds.

Read more about the survey here.