By Jonathan H. Westover, PhD
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Abstract: This article examines the psychological factors that can drive unethical behavior in workplace settings. The article explores how desires for small wins and social validation, overconfidence bias, and rationalizations of unethical pro-social behavior can undermine integrity. It discusses how these cognitive distortions and motivations contributed to escalating issues like fabricated metrics and regulatory non-compliance in various companies. To address these tendencies, the article recommends that leaders clearly communicate ethical guidelines, model adherence to standards consistently, establish a just culture of accountability and learning, and emphasize integrity as a non-negotiable priority above short-term outcomes. By understanding and mitigating these hidden drivers, the article suggests executives can foster an organizational culture grounded in principled decision-making.
As consultants and leaders, we see firsthand how unethical behaviors can permeate an organization and negatively impact culture, performance and the bottom line. Having worked with dozens of companies over the years to addresses issues ranging from harassment to financial impropriety, I've gained valuable insight into why good people sometimes make bad choices at work.
Today we will explore the psychological factors at play and offer practical strategies informed by research for cultivating a values-driven culture where integrity is the norm.
The Power of Small Wins and Social Proof
A key driver of unethical decisions is the desire for small wins and social proof. Behavioral science tells us that we are heavily influenced by our social environment and seek validation from others (Festinger, 1954; Cialdini, 2001). When colleagues are behaving questionably but facing no repercussions, it sets a troubling precedent. Over time, compromises that were once unthinkable begin to feel normal and acceptable as colleagues gain confidence through "getting away with it."
I've seen this play out firsthand in sales teams where gaming metrics becomes an accepted way to hit quarterly numbers. At a tech start-up I advised, employees were encouraged to "think outside the box" which devolved into fabricating project updates to appease restless investors. Without guardrails, the pursuit of small wins through dubious means spirals quickly.
Promoting Integrity through Clear Guidance
To counteract these dynamics, leaders must clearly define ethical boundaries and normalize integrity through consistent actions. This was a key lesson learned while consulting for a global pharmaceutical company grappling with allegations of inappropriate marketing practices. Through our work, management clarified non-negotiable conduct expectations across multiple channels, from new-hire onboarding to monthly skip-level meetings. They also lead by example, taking swift action against violations no matter the offender's seniority or sales record.
Over time, observing leaders modeling integrity and enforcing standards consistently rebuilt trust. Employees internalized that rule-breaking would not be tolerated or normalized, removing the social proof that had previously contributed to gray areas. Resetting culture in this way is challenging but critical to deterring the small compromises that chip away at an organization's moral foundation.
The Illusion of Control
Another subtle yet potent driver of unethical acts is the illusion of control. Behavioral scientists have shown we have an inflated sense of sway over chance-based outcomes (Langer, 1975). This cognitive bias fuels rationalizations like "I can get away with just this once" or "I know this gray area better than the rules envision."
I've witnessed over-confidence in one's abilities contribute to damaging decisions, such as a consultant I worked with who falsified project milestones believing she could deliver eventually. The consequences, as is so often the case, proved more severe than anticipated once uncovered. A food industry executive I counseled was convinced he had outsmarted regulatory inspectors by obscuring testing deficiencies, right up until significant fines were levied.
Establishing a Just Culture
To mitigate the illusion of control, organizations must cultivate a "just culture" where accountability is paired with compassion. This was a lesson learned while advising a logistics firm grappling with a ring of employees skimming cash from deliveries. By taking a collaborative, learning-oriented approach - disciplining infractions fairly but also exploring root causes and new controls - leaders reestablished reliability while rehabilitating wayward staff.
A just culture develops confidence that the system works justly for all parties involved. It deters unethical acts by dissolving rationalizations of invulnerability while still appealing to people's higher natures. Perhaps most importantly, it prevents future failures by viewing mistakes or integrity lapses as opportunities for process improvements rather than personal attacks.
The Appeal of Unethical Prohacking
An underappreciated driver of unprincipled choices stems from the cognitive bias of unethical prohacking, the appeal of using questionable means to achieve an outwardly positive end (Mullen, 2004). During a review of sales practices at a renewable energy startup, I discovered some account managers were creatively restructuring agreements to make quarterly installation goals, with the mindset that helping the company succeed was justification enough.
Of course, the erosion of integrity norms eventually complicated far more deals than it helped close. But in the moment, these acts likely felt like Victories for the overall mission rather than violations. Leaders must address this potential blindspot by emphasizing not just what results are accomplished but also how. Defining ethics as a non-negotiable part of any "win" removes the temptation to bend principles in service of some higher purpose.
The Road to Restoring Integrity
In closing, leaders hold the reins to an ethical culture, for better or worse. By understanding psychological factors like social proof, overconfidence bias, and the allure of unethical prohacking, executives can implement guardrails that mitigate risky rationalizations. They must also set the tone that integrity is a non-negotiable priority through consistent modeling and just enforcement of standards.
Creating an environment where ethical fences are clearly defined yet employees feel psychologically safe taking calculated risks or discussing close-calls can help stamp out the small acts of compromise before they spread. It's challenging work, but the organizations that make character as important as short-term gains will be best positioned to deliver sustained excellence with gravitas and trust. Our role as advisers is to help leaders reset "true north" and tend the moral compass guiding every decision.
References
Cialdini, R. B. (2001). Influence: Science and practice (4th ed.). Boston, MA: Allyn and Bacon.
Festinger, L. (1954). A theory of social comparison processes. Human Relations, 7, 117–140. https://doi.org/10.1177/001872675400700202
Langer, E. J. (1975). The illusion of control. Journal of Personality and Social Psychology, 32(2), 311–328. https://doi.org/10.1037/0022-3514.32.2.311
Mullen, E. (2004). The role of causal attributions in moral exemplification. Personality and Social Psychology Review, 8(4), 275–293. https://doi.org/10.1207/s15327957pspr0804_1
Jonathan H. Westover, PhD is Chief Academic & Learning Officer (HCI Academy); Chair/Professor, Organizational Leadership (UVU); OD Consultant (Human Capital Innovations). Read Jonathan Westover's executive profile here.
Suggested Citation: Westover, J. H. (2024). Understanding the Hidden Drivers of Unethical Decisions. Human Capital Leadership Review, 12(3). doi.org/10.70175/hclreview.2020.12.3.12
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