Purpose – This chapter reviews the challenges faced by top management teams as they strive to create corporate cultures that combine a high performance with a strong sense of integrity.
Methodology/approach – The chapter integrates diverse theories from organizational research and cognitive psychology, as well as published accounts of ethical breakdowns, to shed new light on the barriers to corporate integrity.
Findings – The chapter distinguishes between two major types of ethical breakdowns.
Conscious transgressions, where the individuals know what they should or should not do, but choose nonetheless to follow the unethical path, a decision that they then need to rationalize and which often places them on a slippery slope.
Unconscious transgressions, where the individuals do not even realize that they are making an inappropriate decision, as they fall prey to ethical fading or to other cognitive biases.
Practical implications – The chapter proposes that top management plays a key role in establishing a climate where employees can speak up, emphasizing the importance of all stakeholders, and investing in training to increase awareness of the cognitive biases that support transgressions.
Social implications – The chapter recommends that management educators must alert students more forcefully to the personal and organizational repercussions of “minor” ethical transgressions; increase student awareness of key cognitive concepts, including ethical fading and other mental biases; and highlight the possible dysfunctions of intuitive remedies, like incentives or rules and regulations.
Originality/value of chapter – The chapter provides a clearer analysis of the causes of ethical breakdowns, allowing for more effective prevention.
Manzoni, J.-F. (2012), "Building and Nurturing a High-Performance–High-Integrity Corporate Culture", Davila, A., Epstein, M.J. and Manzoni, J.-F. (Ed.) Performance Measurement and Management Control: Global Issues (Studies in Managerial and Financial Accounting, Vol. 25), Emerald Group Publishing Limited, Leeds, pp. 41-63. https://doi.org/10.1108/S1479-3512(2012)0000025005
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