Pharmac recently released a brief summary of its Workplace Culture Review, and for those of us working in governance, it’s essential reading. The review doesn’t just offer a snapshot of internal dynamics at a high-profile public agency, it invites all boards and leaders to reflect on the link between organisational culture and performance.
At Grounded, we spend a lot of time with boards across Aotearoa talking about strategic clarity, decision-making, and team culture. And what this report reminds us is simple: culture isn’t a side project – it’s at the heart of what makes an organisation thrive or falter.
Why the Review Was Commissioned
Pharmac operates in a uniquely complex space, balancing public funding, medicine access, procurement, and public trust. As expectations of transparency, equity, and agility grow, the Minister set expectations for a clearer, stronger internal culture to support these goals.
This review (led independently by Debbie Francis) was intended to identify what needed to change, and how leadership, governance, and staff could move forward. The findings? Culture change is not optional. It’s essential.
Our Perspective: Culture Is a System Too
The summary of the report surfaces many issues including low trust in leadership, uncertainty about the mission, transactional relationships with stakeholders, and a lack of internal alignment. These are challenges not unique to Pharmac, but ones any board could face without regular reflection and evaluation.
It’s easy to view culture as intangible, but the truth is: it should bes just as system-driven as finances or risk. As the review puts it, “systems are the means by which a business translates its policies and objectives into reality.”
Culture is shaped – intentionally or not – by how people behave, communicate, make decisions, and respond to change. That’s why one of the core areas in Grounded’s Board Health Check includes evaluating culture explicitly.
We ask directors to rate statements like:
- “People take responsibility for their mistakes”
- “There are no hidden agendas or motives”
- “I feel safe to express my views, however controversial”
We ask these questions not to collect nice-to-haves. Instead they check the foundation of trust, respect, and openness that enables a board and its organisation to function effectively.
The review suggests that the Pharmac board should regularly check in whether the time is right to leave behind its current “interventionist” approach and revert to a more conventional approach to governance. The reviewer’s independent nudge is perhaps the most interesting board-level insight we get from the summary which has been released.
Why Culture Should Be on Every Board’s Radar
Boards have a responsibility to do more than monitor finances and approve strategy. They are stewards of tone, values, and integrity. If the culture is off – if staff feel unsafe, unheard, or unclear – no strategy will land well, and no change will stick.
Pharmac’s report calls for a full reset of vision, strategy, and operating model. That level of change will only work if culture is front and centre, and if it’s not treated as a communications project but a core governance issue.
This is where tools like external evaluations, safe reflection sessions, and culture-focused board workshops can make a real difference.
How We Can Help
At Grounded, we help boards and senior teams reflect on how they work together, how decisions are made, and how the internal dynamics of trust and respect play out in practice.
Through our Board Health Check or Board Culture and Team Workshop, we bring structured, evidence-informed support to surface what’s really happening inside the boardroom.
Culture isn’t static and it certainly isn’t just an operational issue. As Pharmac’s experience shows, culture flows from the boardroom. If we want strong, future-ready organisations, boards must lead by example.