The Source of Ethical Fading

What is so insidious or what is so harmful? What is the long term negative impact of creating that culture of lying within teams and within ourselves?

Well, there's this psychological phenomenon, I guess, called ethical fading.

Which can grip an organization's culture where people within that culture become capable of making highly, highly unethical decisions because believing they were well within their own ethical frameworks.

Right.

So extreme examples are things like pharmaceutical companies who have a patent on an essential drug and in order to meet or beat some financial projection, they raise the price of that essential drug 100%. 500%, 1,000%, 1,500%. Totally legal. There's nothing illegal about that. Really unethical. Right. And in organizations that suffer ethical fading, it almost always, if not always, starts from the top. It's usually a leadership problem. It comes from excessive amounts of pressure to hit certain short term goals to the point where doing it ethically becomes more and more difficult. And so what creates ethical fading is a series of things. One of those things is we rationalize. We look for ways to distance ourselves from the impact of our decisions. We say things like, it's what you gotta do to get ahead, it's what my boss wants, everyone's doing it, it's the system, I don't have a choice. Right. And there are ways we can disassociate our responsibility. So rationalizing is a big part of it. Another part is the old slippery slope. You did it once, you did it a little bit, it worked. We raised the price 10%, nobody even noticed. Great, do it again, do 20% this time, try 100%. And it just keeps going and going and going and going before you have full blown ethical fading. And some of the things are excessive use of euphemisms. Again, we're using language to disassociate ourselves from the impact of our decisions. So for example.

We in the United States would never torture. But enhanced interrogation, that sounds very appealing, right? Or companies would never spy on their customers. But data mining, yeah, no, we're really into that. Right. We're just using different language to mask the insidiousness of our real decisions. Like, everybody talks about managing externalities, but we don't talk about the damage we're doing to the people and cultures, environments of the places where our offices and factories are located. Why don't you have that conversation? And so when you have enough of those things.

Ethical fading shows up where you now have real issues. And in the extreme, you have massive scandals. Sometimes it leads to illegal activity, but usually it's just unethical scandals. And when those things happen, management is dragged out and they talk to the newspaper, to the law and they always say the same thing, which is we broke no laws. Everything we do is legal. No, we don't have an issue with the law. We have an issue with your ethics. But when you don't have, when it's not full blown, it just becomes an incredibly uncomfortable and a horrible place to work that increases stress to the point where you'll do damage to your own health and you'll do damage to the way you treat your family because when you're into that kind of stress to violate your own ethics at work, you're gonna come home, you're gonna take it out on your spouse and your kids, you're gonna kick the dog, you're not gonna be motivated to do much except sit on the couch and watch tv, you know, so it has some pretty insidious impact in the lives of human beings.