Despite a growing trend for more ethical investment, Rotterdam School of Management, Erasmus University (RSM) has uncovered eight unethical effects that can sneak in, even when organisations are doing their best to act ethically.

Muel Kaptein, professor of Business Ethics and Integrity Management, has examined how a good organisation can facilitate employees’ unethical behaviour.

This surprising outcome is due to four forces that threaten the ‘good’ organisation, which become more robust as it becomes more ethical, upward, downward, backward, and forward forces.

Each of these directions has two corresponding effects that can arise when organisations become more ethical. And each one of them could increase the likelihood of unethical behaviour. 

‘It helps to know that bad people and bad organisations don’t always cause unethical behaviour. Understanding these effects and how they come about can help society change how ethical standards are set, regulated, inspected and evaluated.’

‘Sometimes the unethical effects come from good people in good organisations – and this insight might help to soften evaluations of unethical practices within and by organisations,’ says Professor Muel Kaptein. 

Delivering a timely warning to business leaders, this research even considers if well-meaning attempts to impose ethical values on investment and consumption might cause the problem. Professor Kaptein has already presented his model of these threatening effects to regulators, compliance officers, and managers.

They all recognised them, and some described their examples of the eight effects that lead to negative and sometimes devastating outcomes. So perhaps this research warns everyone to watch out for these threatening effects.