At a glance
As told to Susan Muldowney
Question: “Ambition is not a negative trait, but highly competitive work environments can steer employees toward unethical behaviour in their drive for success. How can leaders ensure their high expectations have a positive influence on workplace behaviour?”
Answer: The operating environment of organisations can be highly dynamic as the market, clients, stakeholders, government, society and other influential actors make ever-changing demands.
These often conflicting demands, combined with the desire to ensure the organisation’s survival or growth and achieve strategic objectives, can drive leaders, behaviours and targets in both positive and negative ways.
Leaders and their managers are key sources of ethical guidance for employees and for organisational direction, values and culture.
Their realistic or unrealistic demands or targets can enable ethical or unethical behaviour, which can permeate the internal and external organisational environment with significant consequences.
Consider the case of a major financial institution in the United States, which was fined by the US Department of Justice and the US Securities and Exchange Commission more than US$500 million as part of a civil and criminal settlement of US$3 billion in 2020.
The courts found that its employees violated consumer trust, stole client identities, forged signatures and secretly moved client money to meet unrealistic new account sales targets. At the time, the bank publicly promoted a “culture of caring” and its customers rated it more trustworthy than any of its peers.
When pursuing ambitious organisational objectives and excellence, leaders and managers must be cognisant of their actions and the impact of their demands and targets.
They need to look beyond the numbers to the organisational behaviours and culture — as the numbers are unlikely to provide the whole picture. Leaders and managers need to ask:
- Are our targets realistic and achievable?
- Are we achieving what we want to in the way that we want to?
- As a leader, what behaviours and culture am I projecting for others to model? How does this impact wider employee behaviour?
- Are psychological safety and organisational policies in place to ensure employees can speak up and report inappropriate activities or behaviour?
In this case, fraudulent acts and overinflated sales reporting resulted in significant fines, unethical behaviour and brand damage, all driven by leadership — not the outcome they sought to achieve.
If leadership had been in touch with the employees and understood what they were driving, in a culture of respect, feedback and ethics, they may have avoided the public scandal, industry scrutiny, and financial and reputational damage.
Disclaimer: This article should not be considered as legal, tax or financial advice and may not reflect the views and opinions of CPA Australia. CPA Australia does not warrant or make representations as to the accuracy, completeness, suitability or fitness for purpose of this publication and disclaims all liability and responsibility for any acts or omissions made in reliance of this publication. Readers should seek their own professional advice that takes into account their own personal circumstances.
