The Leadership Moral Spiral



In a recent article in the Harvard Business Review, titled: We don’t shun Unethical Coworkers if they are high performers, the authors, Rebecca Greenbaum, and Mathew Quade have found in their research that:

  1. “Specifically, we show that unethical high-performing are less likely to be socially rejected by their peers, which implies unethical behavior can be tolerated.
  2. Unethical high performing employees appear to receive a free pass for their unethical behaviors.”

This raises some sobering implications as to the real effectiveness of ethics education and leadership’s moral compass. If a leader overlooks the perceived fallout of an unethical employee just because he/she is a high producer, what does that “say” to the rest of the employees who, toe the line and act responsibly?

The moral spiral is simply the reality that no one makes a decision in total isolation of that decision not affecting other people. In order words, one issue leads to another, leads to another, etc. in a virtual spiral effect. One cannot make a decision without affecting other people, and this reality needs to be at the forefront of everyone’s decision-making process.

Let’s take this research and see how the Moral Spiral works. An unethical employee that is a high performer is”excused” from any type of consequences for the behavior, but other staff who may have been unethical in their own department, etc. are not. What does this say?

It says many things and here’s the spiral effect.

Spiral # 1:

It affects morale when one unethical employee is seen as the exception because of bringing in more money.When one is seen as the exception, one doesn’t care about how the others feel about him/her, because the leader has their back, because of their productivity.

Spiral # 2:

It tells everyone that as long as you bring in the money, leaders will overlook how you brought it in. The “how.” sales are made, is a crucial component of ethics or unethical behavior. For example, are sales made by undercutting competitors on price? If so, then this person is creating a relationship based on price, and that begs the question if this person gives in once on price, won’t the customer always go after price to do business? This approach is not a trust relationship based process. It rests on the “what can you do for me.” price point. When a business relationship relies solely on the price point, there is no loyalty.

Spiral # 3:

What does this say to prospective customers about relationship building solely on price?

It says” try to keep beating them up” on price” and they’ll cave. Why? Because ethics is a non-required way of doing business. If that is true, what kind of customers are you going to attract and for how long?

Spiral # 4:

What would be the motivation for other employees to be ethical if this type of exception is regularly made?

With all the compliance and hopefully, ethics training employees to receive this”ethics exception.” will cause more trouble than one knows. Why? Because a leader cannot hold all accountable legally or ethically if one keeps making exceptions, particularly based on money. Leaders need to ask, why should my employees embrace all the compliance and ethics training we provide, if I’m not enforcing, modeling and reinforcing those concepts?

Spiral # 5:

 How does “exception” affect the credibility of the leader who is “looking the other way?” Leaders need to understand and embrace the reality that people listen with their eyes and not their ears. It is not what you say that your employees look to, as much as what you do, that is proof of the leader believing in the values of the organization or not. When a leader makes an exception, for any reason, transparency becomes a real issue. If employees, who are trying, every day, to do “the right thing” ethically “see” the leader make exceptions for an unethical employee just because he/she brings in more sales,i.e. money, does this leader understand what message he/she is sending to their other employees so loud and clear? If not, why not?

Spiral # 6:  

Compliance professionals must be demoralized because no matter what they teach, it is undermined by leaders who only make judgments based solely on the bottom line.

Think of the effect of making these types of “unethical” exceptions on those who are training and paid to train, teach, and encourage the living out of the company’s values, mission statement, and laws governing the process. How does this type of “turning the other way” for the sake of a sale, affect those same people? How do they view their role and the subject matters’ importance? How do they go into a training session, knowing that what they teach or train on, is not being enforced by their leaders? What must their morale, work productivity and sense of their purpose be like?

Spiral # 7: 

This acceptance of this unethical behavior, by leaders, no matter the reason, destroys trust and creates skepticism for employees on the effectiveness of the leader.

Why should a leader’s employees trust him/her, if this type of unethical behavior is tolerated? What is the obligation of the leader’s superiors to monitor one’s decision-making skills, the morale of his/her department, the opinion of the compliance/ethics professionals regarding this accepted behavior?

Obviously, this is not an exhaustive list of concerns, but I think you get the idea. Every decision has any number of effects and that reality needs to be a key consideration in making decisions. Every decision one makes is never a decision in isolation! There are always “spirals” of cause and effect that must be non-negotiable in discerning the best possible outcome for all.

Being unethical and having no consequences applied must never be an acceptable option, as too much at stake beyond the P&L statements.