Toxic and unethical culture and climate

Toxic Workplaces

Sull (2022) utilized a dataset of 1.4 million Glassdoor reviews written by US employees to identify various manifestations of toxic organizational culture, which can be categorized as a lack of consideration, courtesy, dignity, inclusion, and ethics, as well as dishonesty, ruthlessness, backstabbing, harassment, and bullying.

Not all these constructs are illegal or easily observable by those uninvolved. They may occur in isolated incidents or be specific to certain employee groups. It is important to acknowledge that much of the behavior stemming from a toxic workplace culture is experienced by employees, but can negatively affect other stakeholder groups. For instance, a customer service employee facing harassment for their religious beliefs may not treat customers with the respect they deserve. Similarly, an underappreciated quality control engineer with low morale may allow errors to go unreported, resulting in defective products being sold to unsuspecting customers. Some unacceptable behaviors in organizations stem from the top. Unethical leadership is “behaviors conducted and decisions made by leaders that are illegal and/or violate moral standards and those that impose processes and structures that promote unethical conduct by followers” (Brown & Mitchell, 2010, p. 588). On the other hand, ethical leadership is the “demonstration of normatively appropriate conduct through personal actions and interpersonal relationships, and the promotion of such conduct to followers through two-way communication, reinforcement, and decision­ making” (Brown et al. 2005, p. 120).

Antidotes for Toxic Workplaces and Unethical Behavior

Embrace Diversity and Promote Inclusion

Because of trends in globalization and increasing ethnic and gender diversity, it is imperative that employers learn how to manage individual and group differences: values, attitudes, and behaviors. Embracing and building a diverse workforce can provide many benefits for organizations. Diversity ensures a wide range of perspectives, which leads to increased creativity and problem-solving capabilities. But it is difficult to lead to diverse cultural backgrounds, experiences, and ways of thinking. Effective and ethical organizations require creating an inclusive environment where all employees feel valued and respected. Navigating these challenges is crucial for leaders to fully capitalize on the benefits of having a diverse workforce. Ferdman (2020, pp. 19-20) emphasizes the crucial leadership behaviors needed to cultivate fairness and equity across diverse identities:

1. Champion accountability in fostering an environment of inclusivity.
2. Promote active engagement and meaningful dialogue.
3. Lead by example by embracing authenticity at work and encouraging others to do the same.
4. Advocate for transparent and inclusive decision-making.
5. Take proactive steps to address and overcome resistance to inclusion.
6. Articulate how fostering inclusion directly aligns with the organization’s mission and vision.

Encourage a Speak Up Culture

Promoting open communication is crucial for addressing workplace misconduct. All employees should feel empowered to report inappropriate behavior, whether directly involved or a witness. Implementing anonymous reporting systems captures unreported incidents, ensures confidentiality, and fosters transparency. Employees may harbor concerns about potential retaliation if they were to report unethical behavior or raise ethical concerns within an organization; therefore, providing appropriate support for complainants throughout the process is essential.

Set Achievable Goals

In high-pressure environments characterized by rigid targets and deadlines, individuals often resort to unethical practices to achieve their goals. These practices can involve shortcuts, data falsification, or the disregard of safety protocols. Relatedly, for employees to remain ethical, it is crucial that they feel at ease and confident enough to acknowledge their mistakes, problems, and failures without feeling the need to conceal them by any means necessary. This necessitates creating a psychologically safe environment, encouraging openness to failures, mistakes, taking risks, and seeking assistance. Limited resources also encourage employees and organizations to compromise their ethics for financial viability. For example, companies may choose to forgo social responsibilities due to the perceived financial burden they pose. Businesses face pressures arising from various sources: the market, competitors, regulatory bodies, and societal expectations. These often-competing pressures exert considerable influence and stress on organizations, which can lead to unethical pro-organizational behavior (UPB) or behavior benefiting one stakeholder group at the expense of another. Finally, an unwavering focus on short-term goals can overshadow ethical considerations.

Champion Transparency and Accountability

At the organizational level, fostering transparency involves promoting a culture of open and honest communication among all stakeholders, including employees, management, shareholders, and customers. This culture encourages meaningful dialogue about the company’s activities, decision-making processes, and overall performance. By engaging in transparent practices, the organization aims to build trust and credibility, which are essential for long-term success in today’s business environment. It is easy to blame others for unethical behavior across vertical organizational hierarchies, especially those with many layers of decision-making or matrix-style hierarchies. Tensions within and between groups also exacerbate this. Transparency can help to assuage the tendency towards this.

Clearly Define Acceptable and Unacceptable Behaviors

Organizations must clearly define proper workplace conduct to accommodate diverse perceptions and evaluations of ethical behavior. Failure to set up formal guidance may lead to the emergence of toxic norms. To prevent this, organizations should set clear boundaries within the workplace, outline unacceptable conduct in their company policies, and promptly address any violations to demonstrate a zero-tolerance approach towards misconduct. Additionally, codes of conduct should be established for leadership, boards, and suppliers. Lack of accountability for unethical conduct can have severe consequences. Without accountability mechanisms, unethical behavior will be perpetuated and normalized. One key to holding stakeholders accountable is to define acceptable behaviors.

References

Brown, M.E., & Mitchell, M. (2010). Ethical and unethical leadership: Exploring new avenues for future research. Business Ethics Quarterly, 20(4), 583–616. https://doi.org/10.5840/beq201020439

Brown, M. E., Treviño, L. K., & Harrison, D. A. (2005). Ethical leadership: A social learning perspective for construct development and testing. Organizational Behavior and Human Decision Processes, 97(2), 117-134. https://doi.org/10.1016/j.obhdp.2005.03.002

Ferdman, B. M. (2020). Inclusive leadership: The fulcrum of inclusion. In B. M. Ferdman, J. Prime, & R.E. Riggio (Eds.), Inclusive Leadership (pp. 3-24). Routledge.

Sull, D., Sull, C., & Zweig, B. (2022). Toxic culture is driving the great resignation. MIT Sloan Management Review. https://sloanreview.mit.edu/article/toxic-culture-is-driving-the-great-resignation/