Given the right circumstances, good people can get caught up in some very bad things. Often, psychology is to blame.

When it comes to unethical behaviour, good people don’t tend to go right off the deep end like Bernie Madoff or Kenneth Lay. Rather, the mind plays tricks on them, pushing them down the slippery slope of questionable behaviour.

“Integrity is doing the right thing, even when no one is watching.” 
-C. S. Lewis

                                                                                      The compensation effect.

ln psychology, compensation is a strategy whereby one covers up, consciously or unconsciously, weaknesses, frustrations, desires, or feelings of inadequacy or incompetence in one life area through the gratification or (drive towards) excellence in another area. Compensation can cover up either real or imagined deficiencies and personal or physical inferiority. Positive compensations may help one to overcome one’s difficulties. On the other hand, negative compensations do not, which results in a reinforced feeling of inferiority.

The compensation effect refers to the tendency for people to assume they accumulate moral capital. We use good deeds to balance out bad deeds, or alternately, we give ourselves breaks from goodness, like a piece of chocolate after a week of salads. This makes people more inclined to do bad things under the guise of “I’m a good person” or “It’s just this one thing.” 

                                                                                          The power of names.

Names matter. Whenever we hear one, we draw a wide range of assumptions about the individual person (or item) in question.

Just ask the fish merchant whose stroke of naming genius turned the undesirable Patagonian toothfish into the haute cuisine Chilean sea bass.

Think about the debate surrounding which is the more appropriate terminology, “illegal immigrant” versus “undocumented worker.”

Or ponder for a moment the raping and pillaging conjured up by “music piracy” as opposed to the parking-ticket-like language of “copyright violation.”

And, indeed, when it comes to specific people, names come chock full of information as well. As the Reggie Jackson example illustrates, whether we admit it or not, when we see a name we draw conclusions about a variety of characteristics, including demographics like race.

What you name something is important, as it can skew people’s sense of reality. If companies assign unethical practices simple and humorous euphemisms (like “financial engineering” for accounting fraud), employees are less likely to take their unethical behaviour seriously. Thomas Watson, the founder of IBM, was famous for saying, “Doing business is a game, the greatest game in the world if you know how to play it.” Something as simple as calling business a game can make people less likely to see that their actions have serious, real-world consequences.

                                                                                   Cognitive dissonance.

In the field of psychology, cognitive dissonance is the mental discomfort (psychological stress) experienced by a person who simultaneously holds two or more contradictory beliefsideas, or values. The occurrence of cognitive dissonance is a consequence of a person performing an action that contradicts personal beliefs, ideals, and values; and also occurs when confronted with new information that contradicts said beliefs, ideals, and values.[1][2]

Cognitive dissonance is the discomfort humans feel when they hold two contradictory opinions, or their behaviour is inconsistent with their beliefs. It’s one of the strongest psychological forces driving human behaviour, and it can be overcome with a high EQ. When people who feel they are good do bad things, cognitive dissonance makes them ignore this behaviour because they can’t tolerate the inconsistency between their behaviour and their beliefs.

                                                                                 Broken window theory.

The broken windows theory is a criminological theory that visible signs of crimeanti-social behaviour and civil disorder create an urban environment that encourages further crime and disorder, including serious crimes. The theory thus suggests that policing methods that target minor crimes such as vandalism, public drinking and fare evasion help to create an atmosphere of order and lawfulness, thereby preventing more serious crimes.

The broken window theory argues that chaos and disorder in an organization make people believe they work for an ineffectual authority. In response, they are more likely to commit unethical behaviour that’s in line with this perceived chaos. An example of this was when Mayor Rudy Giuliani lowered major crime rates in New York City in the 1980’s by cracking down on petty crime. Living in a city that was less riddled with crime, New Yorkers came to believe in the organization running their city, which slowed the rate of major crimes.

                                                                                    Tunnel vision.

Having a vision is a powerful tool. It means that you are honouring your goals, aspiring towards them, and taking risks to expand your horizons. But sometimes our visions for ourselves subtly turn into tunnel vision. We can’t see anything that contradicts our intentions and desires. We get selective perception, which limits our ability to remain open and to see things clearly. Instead of being present to our reality, we put the blinders on and barrel ahead towards our hopes and dreams.

There’s nothing wrong with setting goals and driving hard to achieve them. This only becomes a problem when people are possessed by a singular focus on a goal, to the point that they leave other important considerations such as compassion and ethics out of their thinking.

                                                                              The Pygmalion effect.

A corollary of the Pygmalion effect is the golem effect, in which low expectations lead to a decrease in performance; both effects are forms of self-fulfilling prophecy. By the Pygmalion effect, people internalize their positive labels, and those with positive labels succeed accordingly. The idea behind the Pygmalion effect is that increasing the leader’s expectation of the follower’s performance will result in better follower performance. Within sociology, the effect is often cited with regard to education and social class. The concept of stereotype threat could be considered to be the inverse of the Pygmalion effect, as it denotes a negative form of self-fulfilling prophesy.

The Pygmalion effect refers to the tendency people have to act the way that other people treat them. For example, if employees are treated like they’re upright members of a team, they’re more likely to act accordingly. Alternately, if they’re treated with suspicion, they’re more likely to act in a way that justifies that perception.

                                                                                   The pressure to conform.

The pressure to conform is powerful. When a group engages in unethical behaviour, individuals are far more likely to participate in or condone that behaviour rather than risk standing out.

                                                                                     Obedience to authority.

It’s quite difficult for most people to ignore the wishes of those in authority positions. People also feel like they’re less responsible for wrongdoings if they act under the direction of someone else. Both reasons explain why employees are likely to act out the unethical wishes of their supervisors—and feel far less guilt than if they had decided to do it themselves.

                                                                                  Winner-take-all competition.

We live in a society where there is often only one winner: one person wins the prize, one person gets the job, one person receives the credit. But does this competitive culture really produce the best outcomes? When it comes to ethical behaviour, the answer is no. When there is only one winner in each situation, people are more likely to cheat rather than face the consequences of losing.

                                                                                       Social bond theory.

Employees are more likely to be loyal to their companies if they feel unique, valued, and important. The more they feel that they’re replaceable and underappreciated, the more likely they are to commit ethical violations.

                                                                               The blinding effect of power.

People in power typically see themselves as inherently different from their employees. This can lead them to set ethical boundaries for their employees that are more stringent than the ones they set for themselves. What happens next is the stuff of newspaper headlines.

                                                                                  Conspicuous consumption.

When companies splash money around, they contribute to unethical behaviour. Flashy displays of wealth lead to increased selfishness. Employees either aim hard for these carrots or develop jealousy of their high-rolling colleagues who achieve them. This leads to people who are more likely to put their own needs ahead of doing the right thing.

                                                                                       Acceptance of small theft.

One might think that taking small things from the workplace, like notebooks, pens, and computer paper, is harmless. But when small thefts are ignored by management, people become far more likely to up the ante.


Reactance theory.

Reactance is a motivational reaction to offers, persons, rules, or regulations that threaten or eliminate specific behavioural freedoms. Reactance occurs when a person feels that someone or something is taking away their choices or limiting the range of alternatives.

People like their freedom. If they feel that the rules imposed on them are too strict or too restrictive, they often break those rules—and even go further against protocol than they otherwise would have.

     Bringing It All Together

Perhaps the most shocking thing about ethical violations is the simple, almost mundane conditions that contribute to them. Thankfully, a little bit of knowledge goes a long way in reducing environments that contribute to this behaviour.

Have you seen any of these phenomena cloud people’s moral compass? Please share your thoughts in the comments section below, as I learn just as much from you as you do from me.



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