All posts by Stuart Woollard

OMS LLP creates partnership with Environmental Rating Agency



London, Oxford 22 November 2017: Environmental Rating Agency (ERA) and Organizational Maturity Services LLP (OMS) to provide world’s first unified ratings that combine corporate governance and environmental performance with long-term business value

This unique collaboration offers investors an additional means of viewing company performance beyond the traditional reliance on corporate self-reporting and credit risk ratings paid for by ratees.

ERA/OMS corporate ratings are designed to avoid these obvious conflicts of interest as they are based on a unified assessment of:

  • the corporate values, human systems and purpose of a corporation captured in a single measure of Total Stakeholder Value[I]; with
  • independent scientific metrics of environmental performance based on available science and industry best practice.

These values/purpose ratings and scientific/environmental ratings can be used separately but in combination they provide very powerful insights with enhanced predictive capability.

Unified ratings help investors to understand crucial aspects of any business including its culture, investment strategy, quality of leadership and management attitudes to regulatory, reputational and environmental risks.

This new approach produces non-financial data and insights that will augment credit risk ratings provided by traditional rating agencies, that fail to capture the long-term risks associated with the poor utilisation of human capital, climate change, regulatory arbitrage, complex corporate structures, under-investment and the externalisation of environmental risks. It enables investors to ensure they have aligned their investment principles and sustainability priorities within their portfolios.

Stuart Woollard, Managing Partner OMS LLP said:

“Our ratings and measurement of Total Stakeholder Value are already a recognised measure of the criteria that are most likely to deliver sustainable value creation. By integrating ERA’s scientific ratings and analysis alongside our own, we will be able to provide a deeper understanding of how all the critical, organisational factors interact to create value or risk for businesses, the economy and society.”

Dr Matt Prescott, Chief Executive of the ERA said:

“The Environmental Rating Agency is delighted to be developing a unified ratings approach with OMS. Our aim is to combine the best possible understanding of scientific risks and environmental performance of companies, using independent science, with a rigorous assessment of the underlying corporate purpose and values framing the corporate culture and driving decision making within major businesses. Investors need to be confident they are investing in businesses and assets that align with their investment principles and sustainability priorities, currently this information is not available from fully independent and relevant sources, so we are aiming to fill that gap.”

For more information please contact: stuart.woollard@omservices.org

ENDS

About OMS LLP OMS provides a unique, evidence based approach to organizational health and the creation of Total Stakeholder Value. Our OM30 diagnostic instrument enables measurement and improvement of Total Stakeholder Value (TSV) created by organizations and provides ratings on OMINDEX: a comparative scale from D to AAA. Our work is multi-disciplinary and uses a whole system perspective, aiming to adopt the same level of evidence-based decision making to be found within the medical profession for human health www.omservices.org

About The Environmental Rating Agency Limited. The ERA provides unique and independent ratings of corporate environmental risk and performance for investors. The ERA rates companies using scientific metrics, benchmarks and insights to help investors to make better informed investment decisions. The ERA sees the current reliance on corporate self-reporting and voluntary disclosures as an endemic failure in the financial system. Find out more about our methodology and case studies at www.environmentalratingagency.com

[i] http://www.hrmaturity.com/wp-content/uploads/2017/10/OM30_TSVrecognition-v8.pdf

 

How OMINDEX predicted Barclays culture under CEO Staley

Our  Banking Governance & Culture Project is already producing clear evidence of the challenges society faces in trying to restore even a modicum of integrity to banking and finance. Its Organizational Maturity Rating (OMR) methodology predicted this sort of behaviour by Staley before he even joined Barclays. As our Barclays OMR Analysis & Research Note of February 2016 stated – “Whatever Jes Staley brings from his career at JP Morgan that must include learned behaviours. If banking CEOs have been seen to ignore, endorse or lack awareness of illegal behaviour we could assume they may do so again.” See our latest Human Governance Briefing for further information.

OMINDEX methodology made available to boards, excos and investors

London, 24 February 2017: The Maturity Institute (MI), in conjunction with OMS LLP, releases today its OMINDEX (Organizational Maturity Ratings OM30+© template under a Shared IP Protocol.

Paul Kearns, MI Chair said: “We have made an important decision to share our OM30+ methodology (that produces Organisational Maturity Ratings for the OMS LLP OMINDEX). This is a crucial route to develop both greater understanding and the professional practice of organisational maturity and human governance, which will directly improve Total Stakeholder Value (TSV) as a result.

“We also see this as a crucial step in helping OM30+© become the defining global standard for measuring comparative organisational maturity which is linked to sustained value creation and risk mitigation. The original design of OMINDEX aimed for ratings to sit alongside traditional credit ratings, which are unable to provide good whole system insight into current and future corporate ‘health’. We have now begun to see this aim being realised and sharing this IP will greatly move us forward.”

Stuart Woollard, Managing Partner OMS LLP said: “Sharing this methodology will show boards, investors and key stakeholders the power of Organizational Maturity to analyse and measure so called intangibles such as corporate culture, human governance and workforce management and, at the same time, understand their impact on sustainable value and material business risk. We know from our own experience with companies and the investment community that this is compelling technology that enables comparative measures of critical organisational factors that are currently missing. It also facilitates the design of roadmaps for powerful organisational change to make companies fit for purpose in today’s evolving business paradigm.”

ENDS

To obtain a copy of the OM30+ spreadsheet, for self-scoring your organization today, please send your details (Name, Organization, Job Title) to Stuart Woollard at OMS LLP. An outline pdf copy of the OM30+ is available online. The full working template is available from: stuart.woollard@omservices.org

About the Maturity Institute

The Maturity Institute (MI) comprises a global network of professionally accredited leaders, practitioners and academics creating value for all stakeholders through organizational maturity that realises the full value of human potential for the benefit of society.

 About OMS LLP

Management quality and capability has been missing from conventional company management, valuation and investment decision making. Company failures and material value loss occur on a regular basis yet approaches to identify root causes use ineffective and weak diagnostics. Traditional analysis may identify certain corporate exemplars but not why they are able to generate long-term value differentiation. OMS fills that gap. OMS LLP researches, rates and advises on effective Organizational Maturity and Human Governance; a brand new discipline that finally makes whole, the way we examine, value and engage with companies to generate true, lasting value for all stakeholders.

OMS LLP helps design new CEO Remuneration Model

London, 6 February 2017: The Maturity Institute (MI), in conjunction with OMS LLP, releases today its CEO remuneration model: a unique CEO valuation and remuneration system developed from MI’s ground-breaking framework and its highly rated exemplar organisations.

The CEO Rem model is MI’s Global CEO pay and value standard and can be utilised by boards, investors and other corporate stakeholders. The key features of the MI Model include:

  1. An objective, independent assessment of CEO Value based on the MI approved and globally recognised OMINDEX©* ratings methodology.
  1. The setting of CEO pay based on a formula of Total Stakeholder Value (TSV©) comprised of Price-to-Book ratio (P/B)** and OMINDEX

TSV = P/B x OMINDEX

Paul Kearns, MI Chair and Senior Partner, OMS LLP, said: “Boards, investors and other key stakeholders now have a coherent model and a responsible and highly practical CEO Remuneration System that they can use to drive lasting value for their organisations, including for CEOs themselves, who can now be more accurately valued and rewarded in terms of their contribution to the business.”

John Mansfield, MI Project lead said: “After many years working in executive remuneration it has been truly exciting to develop a unique CEO Remuneration Model that replaces an executive pay paradigm that is now widely recognised as unfit for purpose. For the first time, we have put forward a proven and workable solution that fits with long term, sustainable value goals.”

ENDS

Copies of the new CEO Rem Model are available here and more information can be obtained from: stuart.woollard@omservices.org

*OMS LLP’s OMINDEX© provides a unique perspective on company value creation, linking effective human governance with higher material value and lower risk.

**Price-to-Book ratio is market value divided by book value where market value is synonymous with market capitalisation and book value with net asset value.

People and corporate culture: an introduction for Boards, Excos, and investors

What is maturity? Essentially, maturity and human governance is about maximizing the value of all of people connected to the organization including its supply chain. The language of maturity enables uniform communication about the hard value of the most important intangibles – people and corporate culture.

Maturity analysis is a new perspective, designed to address a specific gap within economic analysis. As Robert Armstrong, a senior economics correspondent at the Financial Times, says in his recent piece on the VW emissions scandal:
“… I will confess I understand little about how corporate cultures work or how to improve them….I think I understand money pretty well; culture puzzles me. But culture is there and it matters. And if we ignore it, there will be more dieselgates in the future.”

See here for our introduction to People & Culture for Boards, Excos and Investors.

Wells Fargo: business risk now needs a human governance lens

Wells Fargo wf has found itself embroiled in yet another corporate scandal. This one looks more serious than previous episodes and has already seriously impacted stakeholders of the bank, including investors.

This article, written by members of MI and the Human Governance research team at OMS LLP considers why  business risk must now incorporate the use of Human Governance expertise in order to help predict the likelihood of such occurrences within the corporate world.

PRESS RELEASE – World’s first universal standard in Human Governance & Human Capital Reporting

HGimageOMS LLP announces the world’s first template for establishing minimum, universal standards of Human Governance & Human Capital Reporting

London, 25 May 2016: The Maturity Institute (MI), in conjunction with OMS LLP, has today made available to investors, company boards and other stakeholders their new Human Governance Reporting (HGR16) standard.

The ground-breaking HGR16 is a set of questions designed to address whether a company’s human governance meets a minimum standard of corporate integrity and legitimacy. The HGR16 is designed to help companies view their operations as a complete, value creation system and facilitate meaningful and insightful human capital reporting. It prompts a broad range of integrated, qualitative and quantitative insights that enable in-depth analysis of how material human capital is to organizational value and whether it poses any significant business risk.

For investors and asset managers the HGR16 provides a key tool to aid effective engagement with companies on critical human governance issues.

The HGR16 standard has been developed from MI’s research-tested “Ten-Pillar” human capital value framework and OMS LLP’s unique methodology for rating corporate maturity (i.e. “AAA” rating reflecting achievement of full value potential).  It can be augmented with in-depth coverage of specific areas e.g. R&D, the entire supply chain or context related risk.

Paul Kearns, Chair of the Maturity Institute says:

“The evolution of company reporting in recent history has witnessed simplistic human capital metrics being offered as proxies for actual value. These indicate reluctance or a lack of awareness to address the real issues behind the pressing demands for greater transparency and more insightful company reporting. Proxies such as employee engagement scores, training activities, or staff turnover, serve little purpose for companies, investors or other stakeholders. The power of the new HGR16 standard comes from its assessment of the whole value system, including crucial facets such as senior management quality and human capital management capability. It delivers the richest picture yet of corporate culture and the likelihood of how this limits value and engenders risk. In the light of the serial, corporate scandals and failures of the last decade the HGR16 is a fundamental tool to facilitate more sustainable, long-term, value creation.”

ENDS

Copies of the new HGR16 are available upon request to: stuart.woollard@omservices.org

About the Maturity Institute

The Maturity Institute (MI) comprises a global network of leaders, practitioners and academics striving to build vibrant, healthy and sustainably successful organizations. Our aim is to build understanding and encourage the practice of effective Human Governance; an approach that not only reconciles the goals of societal and organizational value but makes them mutually inclusive. MI undertakes research, organizes educational events and provides professional development to help organizations better govern and manage human capital to release its full potential in the pursuit of never-ending improvements in societal value.

 About OMS LLP

Management quality and capability has been missing from conventional company research, valuation and investment decision making. Company failures and material value loss occur on a regular basis yet approaches to identify root causes use ineffective and weak diagnostics. Traditional research may identify certain corporate exemplars but not why they are able to generate long-term differentiation and sustained value. OMS fills that gap. OMS LLP researches, rates and advises on effective Human Governance; a brand new discipline that finally makes whole, the way we examine, value and engage with companies to generate true, lasting value for all stakeholders.

Southampton top our new Premier League OMI

The analysis and rating of management quality at Premier League clubs

London, 5 May 2016: OMS LLP published today its final report and alternative league table for Premier League football clubs. Each club has been analysed and rated based on its leadership, management quality and capability for creating sustainable value; not only with respect to its players but from all human capital. The OMS LLP report finds:

  • A more competitive landscape in the Premier League, as clubs invest in management capability, meaning that the simple use of financial resources is becoming less effective in creating success
  • Southampton and Everton are stand out clubs for mature management practice and effective human governance but still capable of significant improvement
  • Clubs exhibit widespread poor governance. There is a general lack of coherence between a club’s purpose, values, and business strategy for creating success on and off the field
  • Clubs have a variety of unexploited material value opportunities: from better methods to successfully predict and use acquired players, broader internal talent utilisation, investment in women’s football, to effective use of critical knowledge
  • Clubs have a poor understanding of human capital risk and inadequate methods to assess and mitigate such risk, making clubs vulnerable to material impact

Stuart Woollard, Managing Partner OMS LLP says:

“Football clubs need to recognize that improvements in the management quality of their whole organization must be made if they want to create sustained value, including on and off the field performance. There is a long way for clubs to go but those who can create coherence around their purpose, values, business and human capital strategy can differentiate themselves against their peers.”

ENDS

For more information please contact stuart.woollard@omservices.org or +44 (0) 7940 585661

About OMS LLP

Management quality and capability has been missing from conventional company research, valuation and investment decision making. Company failures and material value loss occur on a regular basis yet approaches to identify root causes use ineffective and weak diagnostics. Traditional research may identify certain corporate exemplars but not why they are able to generate long-term differentiation and sustained value. OMS fills that gap. OMS LLP researches, rates and advises on effective Human Governance; a brand new discipline that finally makes whole, the way we examine, value and engage with companies to generate true, lasting value for all stakeholders.