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Market-Based Solutions to Vital Economic Issues
Jul 26, 2023

How Destructive Work Behaviors Can Cripple a Company

Ethics at the workplace can be a difficult issue to discuss. Not only do different people bring a plethora of divergent perspectives and backgrounds, but the question of entangling ethics with one’s employment and livelihood often makes for a conversation that’s fraught with tension. However, we also live in a time in which workplace behavior is under greater scrutiny. As big data, technological surveillance and tracking tools continue to be developed, the ability for such scrutiny is consistently increasing. Moreover, understanding the moral frameworks within which we operate can help bridge historically low levels of interpersonal trust we observe today.

Behavioral ethics in the workplace is one of the main research focal points for Marie S. Mitchell, Edward M. O’Herron Scholar and UNC Kenan-Flagler Business School professor of organizational behavior. Mitchell helped us construct a high-level framework for ethical behavior at work, giving guidance on how managers and employees can use insights gleaned from research to inform their conduct.

You’ve written extensively about unethical leadership and unethical leader behavior. How would you define this, and what does it look like in practice?

Unethical leadership is a broad-reaching phenomenon—it involves employees’ perceptions that their leaders’ decisions and behaviors that are unethical (those that are illegal and/or that violate ethics standards) and/or that the leader was perceived to influence employees to act unethically. A variety of behaviors – ranging from leaders’ interpersonally toxic and abusive behaviors to leaders’ illegality and corruption – fall under the umbrella of unethical leadership. Many of these acts have also been well documented in the popular press, such as the sexual assault and harassment cases of Harvey Weinstein (co-founder of Miramax and former CEO of The Weinstein Company) and Les Moonves (former CEO of CBS Corporation), as well as the fraud cases of Russell Wasendorf (former chairman and CEO of Peregrine Financial Group) and Elizabeth Holmes (former CEO of Theranos).

The press has also highlighted how leaders precipitated processes and pressures that generated unethical employee behavior. For instance, Richard Smith, former Equifax CEO, was dismissed for his employees’ failing to properly secure customer information, leading to the breach of millions of individuals’ personal and financial data. Dennis Muilenburg, former Boeing CEO, was dismissed for creating a sales (not safety) culture at Boeing that contributed to the 747 Max crisis and 346 deaths from airplane accidents. And the former CEOs of Wells Fargo (John Stumpf) and Wells Fargo Community Bank (Carrie Tolstedt) were both fired for overseeing a sales culture in which employees created millions of fraudulent accounts due to intense pressure to meet impossible-to-achieve performance goals set by top management.

However, unethical leadership is not limited to top management or high-profile cases. My research has demonstrated that unethical leadership is an insidious problem within organizations and takes many forms. Employees report these leaders to be highly self-interested and offensive, with unethical tendencies that show through in a variety of unsavory behaviors (e.g., deception, rule breaking, power abuse, discrimination).

More broadly, in your research on destructive work behaviors, what are the most damaging workplace behaviors that employers and employees alike should avoid?

In my view, all destructive work behaviors are costly. Some can clearly kill an organization, such as fraud and corruption (e.g., Enron, WorldCom), but most are nefariously embedded within organizations and wreak havoc by way of diminished employee morale and well-being. The stress caused by these types of behaviors in the organization then impact bigger issues, such as performance, turnover, and healthcare and legal costs. Worse, though, is that there is an emulative nature to them in that employees mimic behaviors that are believed to produce results and are valued. Unfortunately, how employees get results is sometimes not evaluated by organizations. So, if managers and employees are lying, stealing and cheating to get bottom-line outcomes and are praised for their results, employees that observe this are likely to do the same.

If a leader becomes aware of certain negative patterns in their management style – for example, micromanaging or placing excessive pressure on their team – how can they work to change these habits and become a better supervisor?

Often leaders’ bad habits are due to their own stress at work and personality characteristics, and so it takes a high degree of self-monitoring and cognitive framing to relearn how to be an effective leader. But, over time, it does get easier. My and others’ research suggests that leaders need to do some self-evaluation to understand how they manage and coach employees at work and do so with gratitude, humility and care. Moreover, being ethically resolute is necessary. To do so takes resilience against high stress and pressure so that leaders can guide employees on how to raise performance efforts and meet objectives in an ethical fashion.

How can workplaces promote ethical behavior in a remote work environment, where there may not be any mechanism for physical supervision of workers?

A commitment to ethics is not limited within the physical walls of an organization. It is instilled in the climate, culture, norms, standards and overall psychological safety relayed to employees. Remote work offers many benefits for employees, such as flexibility, health and work-life balance. The idea that employees might engage in unethical behavior simply because they are not at work is not a great assumption. In fact, it may be that employees are grateful for the opportunity to work from home or outside of the office to accommodate their needs, making them more likely to engage in productive and rule-abiding behavior when they work remotely. It is not to say the possibility of unethicality will not be there – opportunity to engage in unethical behavior creeps into remote work and nonremote work. To offset the opportunity and possibility, it comes down to trust and guidelines about ethics, as well as how performance is assessed (e.g., is it just based on quantity or how performance is accomplished as well?). Moreover, leadership is critical – employees look to their role models to understand how to approach work goals, whether ethically or unethically. Having leaders emphasize a commitment to ethics and display “ethical leadership” is a necessity.

Much of the conversation around the Great Resignation has discussed the decreased job satisfaction and self-esteem of workers, especially following the COVID-19 pandemic. How can workplaces and firms work to change this for their employees?

The “great resignation” has affected many organizations, with employees realizing where, how and why they work – and concomitantly quitting their jobs to accommodate their desired lifestyle. Remote work and flexible work arrangements are ways in which organizations have “leaned into” such desired accommodations for employees. Other employers have revamped the benefits offered to employees, with packages that include prioritizing “proactive rest” (not just PTO) to help reduce job exhaustion and burnout and reinforce employees’ well-being and resilience levels. Understand too that such accommodations also help stave off unethical behavior because employees are far more likely to engage in unethical acts when their well-being is threatened and they are exhausted.

If an employee encounters an ethical quandary at work – in which they may be asked to do something as part of their job that violates their own moral or ethical boundaries – what framework should they use to guide their actions?

I teach Ethical and Inclusive Leadership to our MBAs (full-time and executive MBAs), and my class takes a very practical approach that is based on research evidence. The material is oriented around “the fundamental dilemma” – which is that all employees desire to be ethical and do what’s right, but they also may face situations at work that pressure them to behave counter to ethical values. There is no one framework that offsets these work tensions or provides an answer to ethical dilemmas. Instead, I motivate individuals to understand themselves (through self-awareness) and situational constraints (such as biases that enter into decision-making or are related to bridging good intentions to action) that help them make more ethical choices. The idea is that we should expect ethical dilemmas to occur – more as a common part of work practice – and embrace them so that employees can build skills to continuously understand how to assess them, react appropriately to them and build relationships and structures within their workplaces that motivate ethical action.

Finally, with the increased uptake of artificial intelligence and other technological tools in the workplace, what ethical considerations should managers and workers be most aware of when adopting these new tools?

Like remote work, emerging evidence points to a host of benefits of AI and technological advancements, particularly oriented toward efficiencies and performance. However, emerging evidence also points to detriments of these tools. For instance, research has shown that some AI can be perceived as abusive to employees. Other research has shown that an increased emphasis on AI at work promotes a sense of “asocial-ism” where people become disconnected, which promotes dysfunctional and costly behavior. Moreover, other work has shown that the presence and rise of such technologies at work raise employee insecurity – they fear being replaced – which motivates these threatened employees to engage in destructive and costly behavior. Therefore, as organizations continue to incorporate AI and technological advancements into work environments, it will be necessary to also consider the social cost of these efficiencies and consider how to offset them in a manner that does not impair employee morale.

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