How to avoid scandals that bring down your organization

By Christian Nyvang Qvick, Senior Consultant, LEAD

The risk of being caught up in a scandal has increased in recent times. But a good dose of self-awareness about human tendencies towards unethical behavior, as well as knowledge of the types of organizations that breed scandals, can help you as a leader navigate around them.
It seems like scandals are lining up to topple otherwise solid and established organizations these days.

For those who have communicated their good intentions far and wide, it costs extra hard on the reputation account when the embarrassing cases hit. Think of the Radikale party as a textbook example of the consequences of communicating externally about the unacceptability of sexual harassment, after which one skeleton after another tumbles out of the party offices.

But even for those organizations that don't actively work to build a good reputation in a particular moral field, a scandal can easily lead to reputation-destroying front-page stories. This could be when a nursing home is exposed for neglect and lack of care, or when it comes to light that the mayor of a municipality has illegally acquired a lucrative building plot, or when a company's warehouse workers say they feel like modern-day slaves.

These are just three examples that show how organizational scandals can quickly emerge once the people's court has spoken and the smell of moral corruption spreads through the public, aided by massive piles of negative press.

An increasing focus on scandals

Are there simply more scandals these days? There is some evidence to suggest so. At the very least, the societal conditions for scandals to occur have been amplified. Let's first look at why and in which organizations they most frequently occur.

Firstly, the number of technologies that monitor and analyze our behavior has increased. Secondly, the media landscape has evolved from relying primarily on established media houses to critical media coverage that is now democratized and relies on citizens' use of social media. There are simply more eyes to quickly spot and document missteps. And finally, societal expectations for transparency and ethics in organizational values and behavior have also evolved, raising the bar on how organizations operate.

This societal focus on scandals also means that as a leader, you need to consider how you can prevent scandals from occurring in your organization. There are some things that you and your colleagues individually can be aware of, but there are also a number of cultural and organizational factors that can create a breeding ground for explosive scandals if not handled correctly.

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Self-awareness of potentially unethical behavior

As humans, we don't always act rationally. In psychological research, there are a number of phenomena that describe this, which are relevant to be aware of when talking about unethical behavior. The good news is that by being aware of these phenomena, you can minimize the risk of yourself stepping out of line and becoming the split that triggers the scandal bomb.

  • The first phenomenon is called ethical fading and describes how people can justify unethical actions when, for example, there is an opportunity to "cash in". Ethical fading occurs when, for example, people are so intensely focused on achieving personal or work-related goals that they temporarily lose sight of the ethical aspects of decisions or actions. This bias can, for example, explain why Britta Nielsen lost her moral compass and ended up transferring large sums of money to herself from the National Board of Health and Welfare.
  • Another phenomenon is cognitive imbalancewhich is a term for the discomfort people experience when there is a discrepancy between their values and actions. To avoid this discomfort, the solution can often be to adjust your values and beliefs to align with your behavior. In other words, you justify your own unethical missteps. This is the case, for example, when the municipal manager knows deep down that it is deeply wrong to make private purchases on the municipality's card, but adjusts his attitudes so that it is okay in his particular case - for example, based on the logic: "After all, I work 70 hours a week".
  • Finally, the moral legitimation effect describes a situation where a person justifies their unethical behavior on the grounds that they have performed many ethically correct actions prior to an unethical act. An extreme example of this is former Swedish police chief Göran Lindberg, who, among other things, was a tireless advocate for women's rights and sponsor of a sanctuary for abused youth - while at the same time being a key figure in a violent sex network that earned him a prison sentence for rape, racketeering and pimping.

So what can you do?

  • If you as a leader want to prevent scandals in your organization, you can start with the following:
  • Be aware of situations where your pursuit of important goals can lead to unethical behavior.
  • Keep an eye on whether your moral compass is on a slippery slope if you find yourself continually adapting your attitudes to behaviors you've previously renounced.
  • Consider whether you are taking politically correct actions in order to justify unethical actions.
  • Ensure consistent, values-based communication about what's right and wrong in your organization.
  • Strive for diversity in the composition of leadership groups and teams so that the tendency to contradict and challenge each other arises.
  • Work actively to learn from mistakes, shortcomings and failed attempts, and make it clear that there is room to speak up about doubts and vulnerabilities, as this is fundamental to learning and development.

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