When misconduct goes unnoticed: The acceptability of gradual erosion in others’ unethical behavior

Abstract

Four laboratory studies show that people are more likely to accept others’ unethical behavior when ethical degradation occurs slowly rather than in one abrupt shift. Participants served in the role of watchdogs charged with catching instances of cheating. The watchdogs in our studies were less likely to criticize the actions of others when their behavior eroded gradually, over time, rather than in one abrupt shift. We refer to this phenomenon as the slippery-slope effect. Our studies also demonstrate that at least part of this effect can be attributed to implicit biases that result in a failure to notice ethical erosion when it occurs slowly. Broadly, our studies provide evidence as to when and why people accept cheating by others and examine the conditions under which the slippery-slope effect occurs.

Introduction

Companies such as Enron, Tyco, Parmalat, and WorldCom are often cited as examples of disasters that resulted from unethical management behavior. Both the popular press and academic studies have noted that managers and leaders in modern organizations either lack strong ethical standards (Andrews, 1989, Longnecker, 1985, Molander, 1987, Pitt and Abratt, 1986) or are willing to abandon them in the face of economic incentives or competitive pressures (Gellerman, 1986, Hosmer, 1987). For instance, while accounting firms in this country are charged with providing independent financial statements and reporting client mismanagement, they do so at the risk of displeasing their clients and losing lucrative service contracts (Moore, Tetlock, Tanlu, & Bazerman, 2006). As a result, “independent” auditors often have been found to be complicit in their clients’ unethical practices (Levitt & Dwyer, 2002).

Of course, some individuals who observe the unethical behaviors of others do speak up and report ethical misconduct. For instance, Jeffrey Wigand publicly revealed that executives of US tobacco companies knew that cigarettes were addictive when they approved the addition of known carcinogenic ingredients to cigarettes (Mollenkamp, Levy, Menn, & Rothfeder, 1998). Similarly, Enron employee Sherron Watkins exposed former Enron chairman and CEO Kenneth Lay’s questionable accounting practices in 2002.

Under what conditions are people likely to ignore the unethical behavior of others? This paper addresses this question by examining the predictable conditions that affect whether or not observers of unethical actions speak up and the underlying mechanisms that explain the decision to speak up. Specifically, we focus on gradual erosion in others’ unethical behavior and investigate its influence on observers’ tendency to accept such behavior.

We present the results of four experiments in which we vary the process of deterioration of others’ behavior – gradually, through small changes, or in a single, abrupt shift. We predict and show that people are more likely to accept the unethical behavior of others if the behavior develops gradually (along a slippery slope) rather than occurring abruptly. The studies provide the first empirical investigation of what we call the “slippery-slope effect” within the context of ethical judgment. Our studies also examine why the phenomenon occurs. We show that implicit biases explain at least part of the tendency to ignore others’ unethical actions that occur on a slippery slope.

Over the last three decades, scholars have used different terms to describe psychological phenomena that can occur without an individual’s awareness or intention, including “automatic”, “unconscious”, “implicit”, or “spontaneous” (Blair, 2001). While phenomena that differ along these dimensions can be clearly distinguished on a conceptual level (Bargh, 1994), in this paper we use the term “implicit” to describe phenomena that occur without awareness or intention, and we use the term “explicit” to describe phenomena that occur with awareness and intention. We demonstrate that observers are not fully aware of their ethical lapses when ethical erosion is gradual, and we compare their behavior to the case in which ethical erosion occurs as an abrupt change. Thus, the slippery-slope effect is, in part, a psychological phenomenon that can occur without an individual’s awareness or intention – i.e., it is subject to implicit biases.

Numerous definitions of unethical behavior exist in the literature (e.g., Brass et al., 1998, Treviño et al., 2006). For our current purposes, we rely on Jones’ (1991) broad conceptualization of unethical behavior as reflecting any action that is “either illegal or morally unacceptable to the larger community” (p. 367). Examples include violations of ethical norms or standards (whether they are legal standards or not), stealing, cheating, lying, or other forms of dishonesty. In our studies, unethical behavior occurs when participants accept exaggerated estimates made by others and increase their payoff by doing so. Consistent with this view of unethical behavior, Reynolds (2006) has found that both the presence of harm and the violation of a behavioral norm are positively (and distinctively) associated with moral awareness. For now, we avoid stating whether intentionality is a requirement for a behavior to be unethical, but return to this issue when discussing our hypotheses.