Ethical blindness triggers and the need for stronger ethical leadership

By Anna Koj

The recent Volkswagen emissions scandal is a yet another signal indicating the clear need for stronger ethical leadership in today’s business environment. It can also provoke interesting reflections on the topic of ethical blindness (for a general introduction to the concept see my previous post on Unethical decision-making in organisations & what to do about it) in the car industry.

While it is clear that the Volkswagen software has not been set to cheat the emissions tests by mistake, we still don’t really have enough details, thus it wouldn't really make sense to second-guess, risking to fall into the trap of blaming all or poorly trying to excuse some. Instead, let’s use the topicality of the issue to dive deeper into certain ethical blindness triggers, which are common, although not exclusive, for the industry.

Regardless of the individual responsibilities in the current scandal, a substantial debate on how our societies and businesses function today would be useful to address certain widespread ethical blindness inducing elements.

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It is an issue as relevant to the key decision-makers in top industries as it is to all of us, because ethical blindness is not only limited to those who actively engage in unethical doing. It can and it does affect witnesses of moral misconduct, as well (Francesca Gino and Max Bazerman from the Harvard Business School have done some more in-depth research on the issue).

So, which are the factors that can prompt gradual erosion of our internal moral compass?

People interpret what they see and hear. They familiarise what they experience. Framing can be a natural, internal process, through which individuals make sense of the reality they live in, a process of creating mental maps, through which they structure their world. It can also be an external, intentional process aimed at presenting certain situations in a particular perspective, which makes it an important tool of influence. In both cases, the impact of frames on the decision-making process is huge. Firstly, because we often do not realise they exist and therefore have no conscious control over them. Secondly, because by nature, frames are limiting.

Applying the concept to a business environment, say the debated car industry, if playing on the edges of the grey zone of emissions tests is successfully framed as normality, then overriding the relevant rules and laws becomes simply a yet another way of winning with the competition. Just that. Especially if the frame is reinforced by other elements, which additionally legitimise certain behaviours and discourage independent critical thinking.

Time pressure is one such element. It can affect the decision-maker on multiple levels. Principally, by influencing negatively his or her ability of judgment. Secondly, by adding the element of stress, which can prompt over-compliance and groupthink. Furthermore, when making decisions under time pressure, individuals often resort to heuristics, simplifications based on selectively chosen and usually promptly available information. Naturally, the risk of losing important elements in the process, such as the ethical dimension at stake, rises exponentially. Stimulated, additionally, by high levels of competition within industry, decision-makers feel they can't allow themselves to lose precious time because they will remain behind the trends. Quick wins are needed, decisions are often taken in a gambling mode, with more or less calculated risks.

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Finally, what also needs to be mentioned is the role of organisational context factors, such as for example unrealistic objectives and the culture of fear.

When employees - on all levels of the hierarchy - face constant dissatisfaction with their achievements and see the benchmark being raised above the realistically achievable goals, rarely will they feel positively motivated to improve their work. In a healthy environment, raising the expectations bar higher might indeed bring people to give their best and to go over the expected result. In a world where no missed opportunities are accepted and where one can’t spare any mistake, however, it will rather push individuals to an almost primordial fight that sees no rules and considers no morals.

When this, additionally, is topped with a pervasive sense of fear and instability, not uncommon in such a highly competitive industry as the car producing one, employees tend to develop what is called a tunnel vision. They identify what in their opinion will make the boss happy and they concentrate exclusively on making it happen, while often loosing sight of a broader picture. Tunnel vision leads to silos thinking, which brings us back to limiting self-imposed or externally imposed frames.

These are only a few of a number of factors that can invoke ethical blindness. They all, however, have a common denominator, which is the crucial role of the leader. In a healthy working environment leaders promote ethical vision and they are aware of the risks coming along with a fast-paced and stressful everyday routine of the industry. They filter and stay on top of the things, while giving the general direction to the whole team. It is also their role to ensure that people are not afraid to speak up if they see moral issues at stake and that these concerns become central to the whole organisation's identity. 

More and more scandals of the recent Volkswagen type indicate that we're still missing a lot when it comes to sustainable, healthy leadership. There are individual examples that can lead the way but a broader discussion on the issue is needed not only to punish the guilty ones when bad things happen but rather to promote positive change for the better.

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Originally posted by Anna Koj on LinkedIn, here.