Iatrogenic noncompliance – a case study of ethical blindness

Some thoughts on organizational justice

Organizational justice is the dominant factor determining how employees perceive their organization’s culture of integrity. [1] Management must meet misconduct with decisive, consistent, visible and effective action as a deterrent for recurrence, and as a clear sign that misconduct is not tolerated.

But where exactly does misconduct begin and how do we discern it from mistake/error? Can management truly determine all motives of a person at the time of the misconduct? Is everyone who commits misconduct automatically a bad person, or can “good people do bad things“? Behavioral science tells us of the “bounded ethicality” and the importance of situational factors that can lead to “ethical blindness” [2] of otherwise ethical people.

The Good Samaritan experiment

One example from John Bargh’s “Before you know it. The unconscious reasons we do what we do” [3]: In a psychological experiment, theology students were given the task to prepare a speech on the Good Samaritan. On the way between the building where they prepared the speech and the one where they should deliver it, they encountered person, part of the scientists team, who was apparently in distress and in need of help. The experimenters measured a significant decrease in the readiness to stop and offer help (as in the example of the Good Samaritan) when they put the subjects of the experiment under time pressure by surprisingly cutting short their preparation time and making them hurry to go and deliver their speech, versus the control condition where they had the full preparation time and were not in a hurry when encountering the person in need of help. So time pressure is an example of a factor that can lead to ethical blindness.

Termination or sanction

We all know “zero tolerance” statements towards misconduct. But what about giving people a second chance? Rehabilitation? In such cases management has to decide about a (non-termination) sanction, like a warning letter.

If the sanction is not a termination, management should also be aware of what the sanctioned employee will feel and go through afterwards, because this will determine the true effectiveness of the sanction. Under the right circumstances, the sanction may even serve to strengthen the integrity climate in the organization, because, given a true second chance, a person could become even a strong advocate of ethics and compliance. (“I’ll never make that mistake again and will try to influence others to also learn from my failure.”)

Examples can be found in scripture (Saul turned to Paul) but also contemporarily, Richard Bistrong being maybe the most prominent figure in the area of anti-bribery and corruption.

Marcus and the “signature incident” – a true story

To illustrate, read here the story of a misstep of a manager, let’s call him Marcus (name changed). In one situation, Marcus took a shortcut, broke the rules, got discovered, blamed, shamed and punished. In the aftermath, he went on an emotional roller coaster ride that lasted for several months before he emerged with what he now regards as a strengthened “ethical muscle” and with an enhanced understanding of “why good people can do bad things” out of practical self-experience.

What had happened? Here’s the story.

It was some six months after Marcus had joined the company; a time when he was still going through the motions of some of the regular activities for the first time. He had to prepare a report, have it signed by his superior manager and submit it to Corporate. Marcus had prepared the document but then, because of many other things going on at the same time had simply forgotten to obtain his manager’s signature and to submit the scanned report by the due date.

When he got a reminder e-mail some 14 days after the due date, he realized his mistake, scolded himself for his negligence, quickly printed out the form, went into his manager’s office and said laughingly: “I needed your signature on this, … actually 2 weeks ago.” His bods smiled and winked at him (at least that’s Marcus’ recollection) while signing and said: “There’s no date written here.” In fact he had only written his signature but left the date empty.

The next things happened within a few minutes and without much conscious thinking on Marcus’ part: He wrote the date on the form himself, backdating it by 2 weeks. Then he scanned it and mailed it to Corporate. It could have ended right there and then. But there was a lesson waiting for Marcus to be learnt.

A few days later, he got a call from a person in Corporate who had noticed a discrepancy: The report had a small font footer with the print date. And this was printed two weeks later than the signature date. Gotcha!

The full wrongness of Marcus’ behavior immediately hit him and he felt ashamed, stupid and angry at himself at the same time. It didn’t occur to him for a second to deny or tell a story. After taking a deep breath, he assumed full responsibility and explained: he had forgotten to get it signed at the right time; he had written the false date himself; but the report content reflected the true and fair status of the subject matter as of the required due date – the “apparent” signature date. He said he had done it on his own initiative and without intent to cause any damage or harm to anybody. He also apologized to all involved and said that they should expect better from him.

To cut a long story short: the entire event resulted in Marcus getting a disciplinary sanction in the form of a serious warning letter. His boss made it clear to him that he had never expected him or implicitly endorsed his backdating of the document. The company – rightfully – expected all managers to always do the right thing and in particular him as a senior manager to lead by example. It was only because everyone was convinced that Marcus really didn’t act with bad intent and that there was no harm to the company from his action that he didn’t face more severe consequences.

Of course the story spread on the grapevine. Marcus had the feeling that some people in the were looking at him sideways as if they were thinking: “Who is this guy? How can he do such a thing?”. From some of his business colleagues the reaction was more like: “How could you have been so stupid and get caught? And why is everyone making such a fuss about it because, actually, there never was any risk of any harm coming to the company out of this.”

The ethical blindness perspective

Now, let’s analyze the factors contributing to Marcus actions a little more closely. With hindsight, the following factors were probably at play in influencing Marcus’ decision making:

  • Marcus found himself in a ethical dilemma: After he had made a mistake by forgetting to send the signed report in time, he could either just admit his oversight, submit the form upon the reminder message and face a lengthy discussion (and probably blame, maybe a low performance impression) how he could have forgotten it; or he could (dishonestly) cover up his oversight by backdating the document and spare everyone a long discussion. He chose the latter, putting his personal interest above the values (integrity and truthful reporting) of the company. A conflict of interest in the purest sense. Actually, conflicts of interest (in the sense of agency theory: the moral hazard of the agent acting in his own and against the interest of the principal) are at the core of most if not all misconduct.
  • Narrow cognitive framing: At the moment of decision Marcus didn’t frame the decision as an ethical one; it was purely a reporting matter of completing and submitting a formal documentation which he had duly prepared before. The content of the report was correct as of the reporting date, there was no manipulation or attempt to hide anything in sending the report later. So there was no risk for the company. He could even rationalize (with hindsight) that it was even more correct right to backdate the report to the actual effective date.
  • Moral self-licensing: Marcus didn’t feel he was not doing something bad; he did not want to harm anyone. If he as a senior manager did it, it was ok to change a date (self-serving bias).
  • Situational context: Marcus was surprised and felt time pressure when he realized he had forgotten to send the report at the right time. He was also somewhat annoyed that there had not been an email reminder for the submission shortly before the due date as it was the case for almost every other reporting matter (as I said, this was the first time Marcus was going through this process). Looking back the chain of events and how quickly it happened, Marcus was probably not make a fully conscious decision but was mainly running on System 1 (fast thinking) prone to biases and poor judgment.
    • Culture and leadership context: Marcus’ experience since his start had been that the expectation from everyone was nothing less than perfection and there was little tolerance for even honestly admitted mistakes. If one occurred, finding individuals responsible and putting all the blame on them was the typical consequence (fundamental attribution error). So there was certainly an element of fear influencing his behavior.
    • Institutional and societal (local cultural) context: On top of this, his local organization had at that time a rather “relaxed” practice of handling signature dates on documents. An assistant would usually tell a manager: “You just sign, I will put the proper date later.” As Marcus had experienced on his first day in the onboarding process, he even had to re-sign some HR documents because he first had written date and signature himself. So that was the local culture, the “way things got done” in his subsidiary. From this perspective, it was quite normal at the time for his boss not to write the date himself and leave it blank to be filled by Marcus.
  • A note on hindsight

  • Why am I stressing “hindsight” in the analysis above? We are regarding these events as Marcus recalled them in hindsight. So we should not forget that there is a cognitive bias called the hindsight bias: the general tendency of the human mind to make a story out of the memories and connect bits and pieces of information with causal relations. Also, the mind involuntarily alters the memory every time it accesses it. So, since we cannot travel back in time, we can only recount the events and make the analysis out of Marcus’ own biased recollection of the events.
  • And once we’re at it: let’s not forget the self-serving bias, the tendency to see one’s own actions and motives in a more positive light in order to maintain a positive self image.
  • The emotional roller coaster ride

    It’s interesting what went on with Marcus after he received his sanction from an emotional perspective, because it was a typical Kübler-Ross-curve [4]:

    1. It started with neutralization and denial – denial that he had actually done anything wrong (after all this was the date the declaration should have been signed), denial of responsibility (Why was there no reminder before the deadline? And had not his boss – without words – smiled and endorsed his backdating the document? And had anyone ever properly introduced him to the process or mentored him when doing these key activities for the first time?)
    2. Then came anger and frustration: How could they make such a big fuss about this? Was this a personal issue? True, he had made a mistake but wasn’t this reaction exaggerated? And how many people were informed of this – to damage his internal reputation? His career? And how many other people were not facing any discussions or consequences for backdating signatures on other documents? (Remember this was a common practice throughout the company.) A part of the anger also turned on himself and into self-doubt: how could he have been so stupid? How could he have lost his sense of right and wrong – his integrity? The basis of his position as a member of leadership.
    3. Marcus also started thinking if he wanted to continue working with them or if he should look for another job (“me” vs. “them” attitude, in-group/out-group bias). Together with this came a “passive aggressive” phase where Marcus was extremely critical towards others in his company for any similar kind of mistake. He started being extremely strict in interpreting the rules and calling for immediate and strict sanctions for everyone in case of any small exceptions. (Maybe a positive outcome of this phase was that the company trained all managers and assistants on the signature rules and strictliy insisted that all documents be signed and dated correctly.)
    4. But out of this – and thanks to the personal support of his boss, his team and colleagues, and his family – Marcus started to accept that he had been primarily responsible and he had made the mistake. He forgave himself and the others involved and started to let go. The past was the past. The best we can do is learn from it for the future. And so Marcus got more relaxed and actually started recognizing the lesson in it for him. He also started to work to change his behavior and his local company culture to be more tolerant of mistakes (especially if openly admitted) and frame failure as a learning opportunity.
    5. Finally, more than a year after the event, Marcus presented his story at a seminar on ethical culture. Openly talking about it, and reflecting his insights together with peers was a final step for him to personally integrate this experience.

    Conclusions

    The whole experience has left Marcus with a profound feeling of personal growth and given him new development impulses as well as a new perspective on his role as an ethical leader in his organization. Amongst others he learned

    • how important behavioral insights are in questions of ethics and compliance;
      how “good people can do bad things” because ethical blindness is a reality for everyone;
      How members of management in particular can be prone to moral self-licensing.
      how a culture of “zero tolerance”, “pressure for perfection” coupled with attribution fallacy / correspondence bias can actually produce to compliance violations (I propose to call this “iatrogenic [5] non-compliance”);
      what possible emotional and behavioral response mechanisms employees may experience after getting sanctioned for compliance violations;
      and how crucial it is to stay with them after a sanction to help them achieve a positive outcome and make the event into an opportunity for improvement (for the organization) and insightful growth (for the individual) – hormesis [6].

    The warning letter Marcus received is now his personal “certificate” in understanding ethical blindness and the impact of a culture of perfectionism and zero-tolerance for mistakes on peoples’ behavior. One day – in another company – he might frame the letter and put it up on the wall next to his other achievements. Literally re-framing the experience. Anti-fragility instead of only resilience. [7]

    Finally, taking into account all the influence of situational factors on decision making, we could ask ourselves, what small variances of the situational factors might have changed in influencing Marcus’ behavior at that point in time and space. Might a little more sunshine, a friendly smile or a clap on the shoulder from a colleague, a different wording of the request for the missing report…, have made a difference in the split second when Marcus took his decision? Talking of the butterfly effect…

    And what about others? Has anything similar ever happened to you? Have you ever made a bad decision? Have you faced uncomfortable consequences? And how did that feel and work out for you?

    I am interested in learning about your views and experiences. Please share.

    References:

    [1] CEB, Doing Better Business: From Transparency to Profitability

    [2] G. Palazzo, F. Krings, U. Hoffrage: Ethical Blindness (Feb 6, 2013). Available at: https://ssrn.com/abstract=2212617

    [3] John Bargh: Before you know it. The unconscious reasons we do what we do. 2017

    [4] Dr. Elisabeth Kübler-Ross (*1926, +2004) was a Swiss-American psychiatrist. She first described her theory of the five stages of grief in her book “On Death and Dying” as a result of her work with near-death and terminally ill patients. The Kübler-Ross-curve goes along the five stages Denial, Anger, Bargaining, Depression, Acceptance. The model is often used for describing the mental processing of major change, also in organizational context. https://www.cleverism.com/understanding-kubler-ross-change-curve/

    [5] “iatrogenic” means relating to an illness caused by the diagnosis or treatment (https://en.oxforddictionaries.com/definition/iatrogenic). I am using the term figuratively in the sense of N.N. Taleb in his book “Antifragile”.

    [6] “hormesis” means recovering and actually getting stronger from exposure to a non-lethal dose of a toxin. Again I am using it figuratively according to Taleb to express growing stronger than before as a result of recovering from a negative experience. Hormesis is an expression of antifragility in nature. “That which does not kill us makes us stronger.” (F. Nietzsche)

    [7] https://en.wikipedia.org/wiki/Antifragility

    One thought on “Iatrogenic noncompliance – a case study of ethical blindness

    1. Hi Michael. This is an excellent article, we researched and thought provoking. As someone who experienced my own version of personal misconduct in the past, the human values that promote empathy and compassion were key to my learnings and current moral compass. I personally do not believe people go out of their way to do wrong and there are a significant volume of issues that may contribute to decision making and behaviour at each moment. Your article should given caused for reflection when it comes to assessing misconduct and the appropriate course of action.

      Like

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