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Purpose — The aim of this chapter is to explain the concepts of honesty and dishonesty in management and provide a general understanding why and how honesty and dishonesty may manifest in different ways.Design/methodology/approach — This conceptual chapter discusses what (dis)honesty is, which factors affect it and which consequences result from it. It is illustrated with several short examples.Findings — (Dis)honesty is a complex concept. It is not always possible to classify a certain act as honest or dishonest: sometimes, it is in the ‘grey area’. Moreover, the understanding what is honest and what is not depends on the cultural context. Thus, the term (dis)honesty may be sometimes more appropriate.Originality/value — The complexity of (dis)honesty in management (encompassing its nature, impact factors and consequences) has received relatively little research attention.

There has been a call for additional managerial accounting research that examines the effect of non-pecuniary preferences (such as those for honesty and fairness) on managerial reporting decisions.

Drawing from trait theory, agency theory, and psychological contracts theory, Kidder (2005) suggests that personality traits and perceived unfairness in the workplace both help predict detrimental workplace behaviors, with perceived fairness affecting the honesty in reporting of some individuals but not others. We test Kidder’s (2005) theory in an experimental setting where participants have opportunity and incentive to report dishonestly.

Participants’ honesty preferences and ethical values (idealism and relativism) were measured, and the fairness of the participants’ employment contracts was manipulated. As predicted, higher preferences for honesty are significantly associated with honesty in reporting, suggesting that participants make trade-offs between increasing their own wealth and acting honestly. Additionally, the perceived fairness of compensation interacted with honesty preferences and relativism to affect honesty in reporting.

The implication for practice is that while a small number of employees are likely to consistently behave in honest or self-interested ways, firms may be able to positively influence the behavior of the majority of employees by enacting policies and procedures that contribute to perceptions that compensation is fair.

These findings contribute to our understanding of non-pecuniary preferences on managerial reporting decisions.

We examine the effect of peer honesty on focal manager honesty in a budget reporting setting. We disclose peer honesty to the focal manager at three levels: no, partial, and full disclosure of the reporting behavior of the other managers in the focal managers’ cohort. In partial disclosure, only the reports of the least honest peers are disclosed to the focal manager. In full disclosure, all managers’ reports in the cohort are disclosed to the focal manager. We predict and find that disclosure of other managers’ reports leads to less honesty compared to the absence of disclosure. We show that disclosure changes the focal manager’s perceptions of what constitutes acceptable reporting behavior, such that reporting more dishonestly becomes more acceptable. Our results have implications for understanding fraud dynamics and have practical implications for the design of control systems, as they suggest that managers will use peer dishonesty to justify their own dishonesty, even when they know that only some of their peers report dishonestly.

The purpose of this study is to contribute to the understanding of how personality traits and leadership styles impact employee engagement.

A field study involving a total of 100 participants was conducted to investigate the relationship between honesty–humility, authentic leadership and employee engagement. Hypotheses were tested using correlation and regression analyses.

The results show that honesty–humility impacts employee engagement and that authentic leadership functions as a substitute for honesty–humility.

Further studies are necessary to examine how honesty–humility interacts with other leadership styles. Further studies can also expand the understanding of this relationship across different cultures.

Employees bring engagement to work through their individual traits but organizations can help create an environment that fosters engagement through positive leadership behavior such as authentic leadership.

This study extends the understanding of the role of individual differences beyond the established Big Five model, by adding the honesty–humility dimension. In addition, the authors examine the moderating effects of authentic leadership on the relationship between honesty–humility and engagement.

On the basis of theories of social cognition and moral identity and the meta-theoretical principle of “too-much-of-a-good-thing,” the purpose of this study is to develop and test a model that explains when and why leader honesty/humility promotes subordinate organizational citizenship behavior directed at individuals (OCBI) as mediated through subordinate moral identity centrality.

In this field study, with online surveys, multisource data were collected from 218 United States Air Force officers and their subordinates. Data were analyzed with MEDCURVE SPSS macro tools.

A nonlinear indirect effect of leader honesty/humility on subordinate OCBI through subordinate moral identity centrality was found. This conditional indirect effect occurred through a curvilinear (inverted U-shape) relationship between leader honesty/humility and subordinate moral identity centrality and a positive linear relationship between subordinate moral identity centrality and OCBI.

Cross-sectional data were collected. Future research might replicate findings using experimental and longitudinal designs.

Recruiting and selecting leaders who possess a moderate level of honesty/humility may serve as the first step in producing prosocial behavior during social interactions with subordinates.

This study extends the literature on character and leadership by applying the too-much-of-a-good-thing principle to empirically test the complex nature of the relationship between leader honesty/humility and subordinate OCBI as mediated through subordinate moral identity centrality.

The aim of this paper is to analyse the factors associated with the perception of the value honesty among Russian organisational members from selected former Soviet countries: Russia, Estonia, Latvia and Lithuania.

Using the Rokeach Value Survey, the respondents were asked to rank their own values and to speculate on how their co‐workers would rank the same values. The following analysis focused on the importance of honesty, its concurrence with speculations about co‐workers, the impact of other personal values and socio‐demographic characteristics.

One of the most important findings of this study is that value honesty is amongst the most important values for Russians, while the importance of this value was not similar for Russians living in Russia and the Baltic States. Value consensus tells us the most about how important honesty is for the focal person. Results also reveal that other personal values, namely, family security, comfortable life, imaginative, capable and broad minded help to predict the assessment of honesty.

The results of the study imply that societal influence prevails over cultural influence when the importance honesty is assessed among Russians. Also, we show that individually, value honesty is socially construed and can therefore be manipulated via changing his/her perception of social consensus rather than directly.

The originality of the paper lies in the focusing on the Russians living in different countries of former Soviet Union by analysing the importance of value honesty which plays a role in business and societal culture.

The purpose of this paper is to explore how the concept of honesty can shed light on misreporting issues in projects. Research on honesty can be useful for practitioners and researchers in project management, in order to understand and counter the withholding and distortion of relevant information from projects. In moral psychology, dishonesty is often explained as a result of moral neutralization. The paper provides an account of how neutralization can lead to dishonesty in projects.

The current study is based on a literature review of research on misreporting and dishonesty in projects, and of relevant generic studies of honesty.

The author concludes that the phenomenon of moral neutralization can explain dishonesty and misreporting in projects. Honesty can be encouraged by identifying attempts at moral neutralization, and rendering them unacceptable. At the core of this position is the view that the level of honesty amongst project members is most adequately understood and explained from a circumstance rather than a character approach.

The paper is based on a literature review, and needs to be supported by further empirical studies within project management.

The suggested primacy of a circumstance approach to honesty implies that project practitioners should be aware of the phenomenon of moral neutralization. Even people of good moral character can become involved in neutralization, in order to render misreporting acceptable. The central practical challenge can thus be to recognize tendencies of neutralization in one's own and other people's moral reasoning.

The main contribution of this paper is to introduce the concept of honesty in general, and the concept of moral neutralization in particular, to project management research and practice. The paper also suggests concrete ways to redirect attention from character to circumstances, based on more general research findings in social and moral psychology.

This paper uses a laboratory experiment to examine the effect of accountability pressure as a monitoring control tool to mitigate subordinates' propensity to create budgetary slack. The results suggest that budgetary slack is (lowest) highest when accountability pressure is (present) absent under a private information situation. The results further reveal that accountability pressure is positively associated with subordinates' perceived levels of honesty, which in turn is negatively associated with budgetary slack creation. The findings of this paper have important theoretical and practical implications for budgetary control systems design.

The purpose of this paper is to investigate how trust, honesty and transparency impact the willingness and timeliness of communicating financial information between Government Finance Officers (GFOs) and members of the municipal boards they serve.

Survey data was collected from professionals who work with municipalities to ensure government resources are properly managed. Nonparametric local-linear regression was used to analyze the data.

Evidence suggests that trust in the board, GFO preference for honesty and greater transparency of the municipality influence the timeliness of communication. There is evidence that when the GFO and board members have a working relationship built on trust and the GFO has a preference for honesty, the GFO is more willing to share positive information with the board. In addition, there is evidence that with greater transparency and trust in the board, there is a reduction in the time of sharing positive information in situations where there is little discretion in disclosing and less willingness to share information.

A principal limitation of this study is the small sample size. In addition, the study was conducted using only participants from the pool of members of the Government Finance Officers Association of Texas. As an exploratory study, the survey included a minimal number of questions to gather data from actual GFOs and included only six possible scenarios. The time constraint resulted in a reduced number of questions related to the models used. Other limitations include the potential of missing variables, factors or perceptions related to scenarios not presented in the survey instrument.

The findings suggest that with greater transparency, there is less time between the event and the GFO communication to the board providing the opportunity to improve the effectiveness of the decision-making process.

This study is the first to explore the effects of increased transparency on the level of communication between the GFO and the board.

Discusses honesty and integrity as the basic principle of leadership. Defines quality leadership as a process beyond technical competence. Successful leaders continually demonstrate honesty and integrity as an essential element of their professional fabric; a lack of commitment to the principle renders all other skills meaningless. Depicts honesty and integrity as essential elements of human behaviour that promote and support quality relationships. Defines honesty and integrity in the context of building trust and maintaining credibility. Provides a sound philosophy that increases the probability for long‐term success and professional fulfilment. Includes quotes from contemporary and historical leaders.