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By  Christie Husted PhD, Capella University By  Christie Husted PhD, Capella University

By Christie Husted PhD, Capella University - PowerPoint Presentation

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By Christie Husted PhD, Capella University - PPT Presentation

Renee Gendron MA Presented at the 2010 ASAC Conference May 2125 2010 Regina SK Organizational culture has been defined as written and unwritten expectations of behavior rules and norms that influence members of the organizationRoss 1995 p 346 ID: 799393

corporate cult group business cult corporate business group leader amp people members 2002 cults board behaviour piquero control journal

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Slide1

By

Christie Husted PhD, Capella University

Renee Gendron MA,

Presented at the 2010 ASAC Conference

May 21-25, 2010 Regina, SK

Slide2

Organizational culture has been defined as “written and unwritten expectations of behavior (rules and norms) that influence members of the organization”(Ross, 1995, p. 346).

How likely is an organisation to place restraints and punishment on deviant behaviour, determines levels of deviant behaviour (Tittle, 1995)

Slide3

Levels of control are “reflected by the control experienced across any number of situational and global domains” Piquero and Piquero (2006)

Relationship between CEO and board

i) little contact between CEO and board

ii) controlling – CEO sets direction board just “rubber stamps”

iii) collaborative relationship, iv) focus on each party's strengths (Cady & Soukup, 2008)

Slide4

2008 Ph.D Dissertation by Husted:

Systematic Differentiation Between Dark and Light Leaders: Is a Corporate Criminal Profile Possible

Dark Leadership, defined through Edwin Sutherland (1949) coining of the term “white-collar crime”, defining it as a criminal act of respectable individuals in the course of their occupations

Led to questions about leadership

Concerns about group interactions

Slide5

Slide6

Arthur Levitt, Former Chairman of the

Securities and Exchange Commission (SEC)

from 1993 - 2001, stated there was

A “Culture

of Gamesmanship” where it was considered okay to bend to the pressures of analysts.

A culture which believed it was okay to tweak the numbers and bend the rules and to allow discrepancies to slide” (Smith et al., 2006).

Slide7

Group think occurs in a situation in which a

group is extremely cohesive and there is a strong

desire to reach consensus among members.

Signs of group think:

i) illusion of Invulnerability

ii) collective rationalisation

iii) illusion of morality

iv) excessive stereotyping

v) pressure to conform

vi) self-censorship

vii) illusion of unanimity

viii) miniguards: people

protect group from outside information

Slide8

Organisational culture starts at the top

Rey (2002).

Without that creative dynamic, of being able to openly constructively criticize, an environment of fear, antipathy and stagnation sets in.

Slide9

Truab & Little (1975) defined deviance as “ behavior which violates institutionalized expectations, that is, expectations which are shared and recognized as legitimate within a social system”

Alison et al. (2002) identified the need to approach behavior using a holistic approach; focusing on the interaction of the Person x Situation

Slide10

Argument to include internal organisational people-processes and people-dynamics in the definition of “Corporate Social Responsibility”

CSR must also include how an institution monitors and manages the human interactions occurring in it

Focus on people-dynamics not just for corporations, but also NGOs, government institutions, private firms

Slide11

Internal human-processes of any organisation, including corporation that may lead to deviance

Human-processes include but not limited to:

Supervision: Too much, too little

Validation: Yes Men, Group Think, Gang/Cult Mentality, Justification

Slide12

A cult was defined by Robbins and

Anthony as a group having manipulative,

authoritative leadership and coercive

power. Likely to have:

Authoritarian leaders

Totalitarianist in their organization

Have a specific form of indoctrination (Richardson, 1993, p. 351)

Slide13

Pavlos' Points on a cult

Business Cult – like Behaviour

A cult has a living leader in which the direction of the cult is set by the revelations of the leader

A living leader;

whose charisma is used to manipulate followers into

working towards

the leader’s personal

vision, not the company vision

A cult's religious leader has absolute authority over the group

A person who micromanages, who squashes any sort of independent thought, who refuses to hear the input of staff or colleagues

and uses transactional relationships and coercive power to gain compliance of followers

Slide14

Pavlos' Points on a cult

Business Cult – like Behaviour

A cult promises converts salvation through hard work and loyalty

In business terms, this can be translated into greater profits, subsequently equating

with

higher pay

as long as the individual is willing to conform and transact the behaviors prescribed by the group and its leader

Cults require the members do demeaning work for the cause

Those who consistently question the leader

s vision or strategy are relegated to work which is far below their capabilities,

and are subject to coercive power and reprisal for not transacting the wishes of the group and its leader

Slide15

Pavlos' Points on a cult

Business Cult – like Behaviour

Cults promise everlasting salvation for their faithful followers

As long as members continue to do what the leader tells them to do, they will maintain high financial rewards

Converts must remove themselves from the greater society

Increasingly the business becomes more opaque, even to auditors and regulators

Cults strongly discourage critical thinking

The compan

y’s leader surrounds him/herself with yes people and encourages group think.

Slide16

Pavlos' Points on a cult

Business Cult – like Behaviour

Cults create strong feelings of dependency between cult members

Workers directly involved in the fraud or criminal act become increasingly hostile to outsiders.

Cults indoctrinate members through extreme personality, attitude, belief and behavioral change techniques

Workers become increasingly consumed by their employment, their personal lives are out of balance with their work lives.

Cults practice rituals which are psychologically unwholesome to members

Work related performance is increasingly judged by hard metrics instead of a combination of hard and soft metrics.

Slide17

Too much supervision: Enron executives led Wall Street analysts through the trading floor (previously empty rooms). It looked like people were working – they were pretending.

Too much supervision can led to micro-managing, bullying, loss of critical thinking in staff; over-dependence on a few people

Slide18

Superficial charm

Grandiosity

Manipulation

Deceit

Lack of remorse

Shallow affect

Failure to accept responsibility

Failure to conform to social norms

Impulsivity

Irritability and/or aggressiveness

Disregard for safety for self or others

Lack of self-awareness

Lack of self-monitoring

Inability to manage emotions

Self motivation

Inability to relate well to others

Slide19

Dr. Christie Husted

chusted[@]sbmconsultingservices.com

Renée Gendron, MA, Ph.d candidate

reneegendron[@]hotmail.com or

rgendron[@]ciian.org

Folders with full article and presentation available

Slide20

Slide21

Alison, L., Bennell, C., Mokros, A., & Omerod, D. (2002). The personality paradox on offender profiling: A theoretical review of the processes involved in deriving background characteristics from crime scene actions.

Psychology: Public Policy and Law

,

8

(1), 115-135.

Cady, Joseph, H.; Soukup, William, R., (2008),

“The Ugly Truth about Board Relations: SOX Isn't the

Biggest Problem, It's the Interpersonal Relationships. Here is a Way to Move Your Board from

Dysfunctional to Optimal”

, in ABA Banking Journal, Vol. 100, Issue 2, Simmons-Boardman, (Gale Cengage Learning), pages 47-48

Coleman, J. (1987). Toward an integrated theory of white-collar crime.

American Journal of Sociology, 93

(2), 406-439

Corporate (2009), In

The FreeOnline Dictionary by Farflex.

Retreived May 15, 2009, from The Free

Slide22

Cressey, D. (1953, 1971).

Other's people money: A study in the social psychology of embezzlement.

Belmont, MA: Wadsworth

Felo, A., (2001, August),

“Ethics programs. Board involvement, and potential conflicts of interest in corporate governance”,

Journal of Business Ethics, Vol. 32 Issue 3, 205.

Gray, Kenneth R.; Clark, George, W., (2002), Addressing Corporate Scandals through Business Education,

International Journal on World Peace, Vol. 19(4),

49-51

 Husted, C., (2008), Systematic Differentiation Between Dark and Light Leaders: Is a Corporate Criminal Profile Possible, Capella University

Moore, J. (1992). Corporate culpability under the federal sentencing guidelines.

Arizona Law

Review, 34

.

Online Dictionary:

http://www.thefreedictionary.com/corporate

Slide23

Piquero, N., & Piquero, A. (2006). Control balance and exploitative corporate crime.

Criminology, 44

(2), 397-430.

Piquero, N., Exum, L., & Simpson, S. (2005). Integrating the desires for control and rotational choice in the corporate crime context.

Justice Quarterly, 22,

252-280.

Rey, J., (2002), “Lessons Learned from Enron. Say “No” to “Yes-Men”, in About.Com: Management, September 19, 2002, Retrieved January 20, 2010 from http://management.about.com/cs/generalmanagement/a/Enron091902.htm

Richardson, James, T., (1993), Definitions of Cult: From the Sociological-Technical to Popular-Negative,

Review of Religious Research

, Vol. 34(4): 351

Ross, D.; Benson, J., (1995), “

Cultural Change in Ethical Redemption: A Corporate Case Study”

, in The Journal of Business Communication, Vol. 32, Issue 4, Association for Business

.

Slide24

Smith, H. & Schaffer, M. (Writer), & Schaffer, M. (Director). (2006). Bigger Than Enron [Video recording]. Schaffer, M. (Producer),

Frontline

. Boston, MA: PBS.

Sutherland, E. (1934).

Principles of criminology.

Chicago, IL: Yale University Press.

Sutherland, E. (1949).

White collar crime.

New York: Holt, Rinchart and Winston Traub, S., & Little, C. (1975).

Theories of Deviance.

Peacock Publishers, (Itasca, IL).

Tittle, C. (1995), Control Balance Theory, Boulder, CO: Westview

Velasquez, M. (2003). Debunking corporate moral responsibility.

Business Ethics Quarterly. 13

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