W4 - Scholten & Ellemers Bad apples of corrupting barrels?

Question 1

Misconduct

Answer 1

Intentional unethical behavior

Sabotage such as misintepretation in financial reports, theft, failing to report information on deals

Behaviors that are not illegal can be considered unethical and qualify as examples of misconduct

Unintended behaviors and accidents are excluded

Question 2

Responses to misconduct

Answer 2

1. Containment attempts: attempts to control the damage of misconduct reveleations can make the misconduct seem small
2. Disciplinary measures: taking disciplinary measures against the traders involved relates to the strategy of containing reputational damage by blaming specific individuals
3. Increase of controls: organizations extend procedures and resources for risk management, compliance and audit

Question 3

Why standard responses are insufficiently effective

Answer 3

• Focusing on stadard responses impairs the possibility to learn from past misconduct
• Contributes to repetition of known problems
• Legal and financial sanctions have stronger effects

Question 4

Bad apple theory

Answer 4

When the individual is solely to blame for misconduct
A trader behaving unethically is a bad apple that needs to be removed from the barrel

Question 5

What does the bad apple theory fail to explain?

Answer 5

1. Limits the understanding of the causes of misconduct
2. Does not explain why certain trading teams have a history of misconduct
3. Suggests individual-level behavioral change is unlikely
4. Does not take into account external factors (toxic leadership)

Question 6

Corrupting barrels model

Answer 6

Encompasses 3 team characteristics that can contribute to misconduct addressing the way the team deals with its:

1. Task: ineffective error approach (denial, empathy, blame & punish)
2. Interpersonal relationships with the team: outcome inequality
3. Team climate: dysfunctional moral climate

Question 7

Performace errors - how they are dealt with

Answer 7

1. Denial: the possibility that errors may and do occur is denied
2. Empathy: when the possibility that errors may and do occur is acknolwedged
3. Blame and punish: errors are not tolerated

Question 8

Outcome inequality

Answer 8

• Can raise dissatisfaction
• Team members can feel unjustly treated
• Dysfunctional work behavior
• Envy in the workplace: justification of unethical behavior by believing that this behavior helps to ‘restore equity’

Question 9

Dysfunctional moral climate

Answer 9

• Can facilitate misconduct
• When moral guidelines are unclear, we look around for guidance

Question 10

Social nature of morality

Answer 10

Our sense of right and wrong is influenced by the people around us.

• In a group, we might follow what others do or say, even if it goes against our personal morals
• This can cause us to lose sight of our own “moral compass” and act unethically because we’re conforming to the group.

Question 11

Types of immoral team climates that encourage unethical behavior

Answer 11

1. Climate of moral neglect: the mildest form of dysfunctionality, mild awareness of moral content of decisions
2. Climate of moral inaction: situation in which individuals are clearly aware of negative moral implications of their behaviors but feel unable to adapt their actions accordingly
3. Climate of moral justification: a work environment where unethical actions are presented in a way that confuses or distorts people’s understanding of what is right or wrong

Question 12

Perspective on change: preventing misconduct

Answer 12

• Check if poor error handling, unfair outcomes, or toxic team environments encourage misconduct in trading teams
• Focus on addressing the social and psychological causes by improving how errors are managed during tasks.

Question 13

Blame-free reporting of errors

Answer 13

Could help stimulate more open communication