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This study aims to invoke social comparison theory and researches mainly on leaders’ downward envy at workplaces in a collectivist culture. The study also aims to infer and explain the constructive and destructive behaviour of benign envy (BE) and malicious envy (ME) in the workplace by studying supervisor-subordinate dyads.

A survey was conducted to test the proposed hypotheses. The sample included 352 randomly chosen supervisor-subordinate dyads from registered software houses in Pakistan. Partial least square SEM was used to test the proposed model and hypotheses.

This research identified that the leaders' gratitude and workplace friendship encourage leaders to adopt a levelling-up strategy to encounter benign envy (BE). In contrast, subordinates’ low level of loyalty and affect towards supervisors cause ME. The study also found that BE motivates frustrated supervisors to behave positively, whereas ME triggers the envious supervisor to threaten their aides with abusive supervision. However, envious supervisors with high core self-evaluation and gratitude are more likely to reflect self-improvement.

This study gives key insights to organisations on recognising the potential of downward envy, using it purposefully, and managing the consequences constructively. For instance, organizations could train leaders to understand the holistic view of downward envy to help them focus on self-improvement instead of abusing employees. In addition, training employees on envy could help them demonstrate warmth and competence.

The study is original and valuable in three aspects. Theoretically, this study develops a generic framework for dealing with downward envy. Contextually, the study brings a piece of evidence from software houses in Asia to study downward envy. Practically, this study suggests tactics to deal with downward envy in family-owned tech firms operating in emerging markets.