By Martyn Herman

LONDON (Reuters) - Embattled British Cycling says its gold-at-all-costs approach will be softened after accusations of a bullying and sexist culture within a system that has become a medal factory.

Funding body UK Sport opened an independent investigation into the culture within British Cycling last year after former technical director Shane Sutton quit over allegations of sexual discrimination against track cyclist Jess Varnish.

The findings of the investigation, initially expected to be published last month, have been delayed, but the governing body and UK Sport issued a joint statement outlining an action plan for "better behavior" on Thursday.

New British Cycling chairman Jonathan Browning admitted to "failures" in its World Class Program, which has delivered unprecedented medal success at the last three Olympic Games: eight golds in Beijing, eight in London and six in Rio.

"(The failures) occurred at a time when our sport and indeed the wider UK high-performance system were undergoing rapid transformation in terms of realizing unprecedented medal success on the world stage," Browning said in a statement.

"Our cultures and behaviors must be a focus for the whole organization and we will work with staff, riders and volunteers to develop a set of common values and behaviors.

"Performance or personal development is not a choice great organizations ask people to make, they help people do both -- that's where British Cycling is headed. We deeply regret any instance where we have failed to deliver."

UK Sport said it would publish the findings of the investigation "in as open and transparent a way as possible".

Chief Executive Liz Nicholl said "valuable lessons" had been learned and that riders would start to experience "positive actions" from the findings of the review.

British Cycling will receive 25 million pounds in the lead-up to the Tokyo Olympics, down from 30 million in the Rio cycle.

Nicholl said the funding was "conditional" but was not threatened by a turbulent year, which also saw British Cycling at the center of an ongoing UK Anti-Doping (UKAD) investigation into "allegations of wrongdoing in the sport."

On Wednesday, its record keeping was criticized after a Parliamentary committee hearing heard that no proof was available that a package delivered by a then-British Cycling coach to former Team Sky rider Bradley Wiggins in 2011 was indeed a legal flu treatment.

"We make an award and attach conditions that require changing, and the sport has to deliver against those," Nicholl told Reuters by telephone. "It's conditional on an action plan which includes reviewing medical processes."

Nicholl agreed that British Cycling had some work to do to restore its reputation but was encouraged by its response.

"It's bruised, definitely, but retrievable," she said. "There have been a number of issues, but they have apologized for what's happened and this a new beginning for them."

British Cycling has undergone an upheaval with Browning taking over as chairman, Stephen Park moving from sailing to performance director and a new CEO to be named shortly.

"This is not about complying to protect funding, this is about running our organization in a way consistent with our ambition to be a world-class governing body," Browning said.

Sutton quit last April after Varnish said he told her to "get on with having a baby" after she was dropped from the elite program. Allegations of bullying were supported by former Olympic champions Nicole Cook and Victoria Pendleton.

(Reporting by Martyn Herman, editing by Larry King)