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Power, Justifications & Unethical Behavior

The Influence of Justifications on the Unethical Behavior of Power Holders

Master thesis, M.Sc. Human Resource Management University of Groningen, Faculty of Economics and Business

June 14, 2015 TOBIAS J. GÜNTHER Student number: S2636751 Regulusstraat 37, 9742 LM Groningen tel.: +31 (0) 633 22 85 98 email: t.j.gunther@student.rug.nl Supervisor: Sanne Feenstra

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Abstract

Power is often associated with unethical behavior. Previous research identified several different factors that moderate this relationship. This study takes it one step further by taking the availability of justification into account in order to explain when power holders engage in unethical behavior. In addition, the comparison between the individual influence of self-justifications and other-self-justifications on power holders’ unethical behavior was examined. Within this study, an experiment with students was performed which revealed that the availability of self-justifications is a crucial moderator of the relationship between power and unethical behavior. Furthermore, having power compared to having no power turned out to enable ethical behavior in the absence of justifications. The findings of this study contribute substantially to the research field of moral identity and moral awareness. Initial suggestions for organizations to counteract the unethical behavior of their leaders were derived from the research.

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Power, Justifications & Unethical Behavior

The Influence of Justifications on the Unethical Behavior of Power Holders

„…absolute power corrupts the best natures.” (Lamartine, 1848). This quote from over 160 years ago describes a very common presumption about the nature of power that remains unvaried until today. When we take a look at the powerful protagonists in human history we see that many of them were, and still are people with a tendency to act unethically. In the last decades, more and more cases of power abuse became public and the corruption of the powerful minds became an often discussed topic. The sometimes severe consequences of unethical behavior of power holders can affect the efficiency of the organization they work for, as well as its reputation, and in some cases, also have an influence on the common well-being of a whole society (e.g. Lehman-Brothers in 2008). But when do leaders engage in unethical behavior, and what factors influence their decision in favor of e.g. acting in a more self-serving way, instead of in the interest of their organization? Previous research examined different moderators that influence the relationship of power and unethical behavior, ranging from personal characteristics (Chen, Lee-Chai & Bargh, 2001; Fast & Chen, 2009) over the perception of one’s environment (Georgesen & Harris, 2006; Morrison, Fast & Ybarra, 2009) up to other factors like accountability (Rus & van Knippenberg, & Wisse 2012; Tetlock, 1981; Lerner & Tetlock, 1999) or feeling of entitlement (De Cremer & van Dijk, 2005).

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As of this writing, research has identified several variables that influence the relationship between power and unethical behavior (see above), but with little respect to the influence of justifications. However, the influence of justifications on unethical behavior has been examined in the past, but the explicit influence on the unethical behavior of power holders was limited to other-justifications (e.g. Rus et al., 2012; Tetlock, 1981) and focused on the absence of it. The current research is going to fill these gaps by examining the influence of both, self- and other-justifications, on the unethical behavior of high power individuals. Specifically, the comparison between the influence of the availability of self- and other-justifications will contribute to other research on when high power individuals engage in unethical behavior.

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power individuals. Therefore, being able to justify one’s future unethical behavior could be a crucial factor in the cognitive process of a power holder, when deciding whether to act in line with social, moral and legal norms or to follow behaviors which are considered unethical. In contrary, I expect the availability of justifications not to have an influence on the unethical behavior of low power individuals, as they have a higher sensitivity to threats and punishments (which unethical behavior could have as a consequence) and tend to reason in more complex ways than their powerful counterparts, which could lead them to think more thoroughly about potential negative consequences (Keltner et al., 2003).

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THEORY AND HYPOTHESES

Power and Unethical Behavior

The concept of power leaves room for several interpretations, in the context of this research power is defined by holding at least one of the following features: Having control over a significantly higher amount of valuable resources than low power counterparts, regardless of whether the resources consist of tangible assets or intangible goods like information (Emerson, 1962; Galinsky, Magee, Gruenfeld, Whitson & Liljenquist, 2008). Another characteristic of power is that power holders can affect outcomes of individuals or a group by making personal decisions (Mumford & Connelly, 1991) or simply having the ability to influence others (Guinote, 2008). The last interpretation of power that is going to be used in this research is the fundamental definition of power by the German sociologist Max Weber (1972). According to Weber, power is defined as every chance to enforce one’s own will, even against resistance within a social relationship regardless of the chance’s purpose (Weber, 1972). To sum it up, in the context of this research being in power means having control over valued resources, being in a position where your actions have an impact on the outcomes of other people, being able to influence others or having the chance to enforce one’s own will against the will of one’s counterparts. In contrast, low power individuals do either not possess any of those characteristics or on a significantly lower level than their counterparts.

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used in this study. Actions that are associated with self-interested behavior, are those which come at cost of another individual or the common good and serve solely the gaining of surplus value of the action taker.

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The findings of Guinote (2008) state that the attention of an individual becomes more focused when it is experiencing power, she concluded that focused attention leads to focused behavior. This focused behavior can be seen as a trigger for potential unethical behavior, as a very focused point of view and therefore focused acting could promote the chances to behave unethical, as possible negative consequences of the unethical acts could be out of the power holder’s focus. This assumption is in line with the findings of Inesi (2010), who concluded that powerful people are less concerned about the negative consequences of their actions. Specifically, they showed that power holders focus on what they want or need to do without giving much thought on what negative consequences their behavior could have. Another argument in favor of the assumption that power leads to unethical behavior was made by Kipnis (1972) as he found that individuals who have power steer the division of scarce resources towards their own benefit instead of caring for the optimal common outcome. Supporting Kipnis’s findings, De Cremer and van Dijk (2005) found that people in power positions award themselves more resources in resource allocation games, than people who did not have power.

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al., 2009), while accountability seems to decrease unethical behavior (Rus et al., 2012). The findings of De Cremer and van Dijk (2005) showed that power holders who felt entitled, regarding their power status, acted more self-serving than their counterparts, who perceived their high power status as randomly ascribed.

In order to examine a so far neglected potential moderator, the current research aims to extend past research by examining the role of justifications for the unethical behavior of high power individuals. This research suggests that high power individuals act more unethical when they are able to justify their actions to either oneself or other people. I expect a person who is able to give a comprehensible reasoning for his or her unethical behavior, to either oneself or others, to be more likely to act in this way. Specifically, I expect the availability of justifications only to have an influence on the behavior of people in high power positions, whereas it should not influence people in low power positions. This is due to past research, which ascribed low power individuals an inhibition in behavior (Guinote, 2008) and a lower sensitivity to rewards (Keltner et al., 2003), compared to their powerful counterparts. Furthermore, low power individuals have an increased level of hesitation (Holtgraves & Lasky, 1999; Hosman, 1989) and a more complex way of reasoning (Keltner et al., 2003). These findings support the expectation that the availability of a justification will not affect the unethical behavior of low power people, as hesitation and complex reasoning could lead them to reason against unethical behavior, even in the presence of a justification, and to think more about potential negative consequences of their behavior.

The Availability of Justifications

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behavior of high power individuals will give new insights on what enables power holders to act unethically. Further, information about which kind of justification has a greater impact on a power holder’s likelihood to behave unethical is of high interest, as it can give clues on where organizations can start to take action against violation of ethical and legal norms by their leaders.

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a self-justification increases the extent to which an individual is willing to act unethical, as the positive self-image can be maintained if the unethical is justifiable to oneself.

The research on the relationship between power and the associated tendency for unethical behavior leads to the suggestion that people in high power conditions should show an increase in their unethical behavior, when a self-justification is available. Power holders have a greater desire for approaching success and a better eye for the detection of opportunities to gain material rewards (Keltner et al., 2003). Since achieving success and gaining rewards seem to be typical desires of power holders, I suggest that power holders are more likely to pursue those needs by acting unethical, when they are able to make use of a justification, compared to one that does not. In contrary, I expect the availability of self-justifications not to influence the behavior of powerless individuals. This assumption is supported by research which shows that low power is accompanied by a selective alertness to potential threats and punishments and a higher likelihood for behavioral inhibition (Keltner et al., 2003). Keltner and his colleagues (2003) further described the behavioral characteristics of low power individuals as limited in thought, word, and action. If low power people are more aware of the potential consequences of their behavior and additionally inhibit it, then they are less likely to pursue a goal by acting in an unethical way and therefore the availability of a self-justification should not have an influence on their behavioral choice. Someone who is aware of consequences and reflective to his own behavior will not change his attitude towards immoral actions because he is able to justify it, as this will not alter the threat of punishments and still requires action-taking. The findings of past research on the different characteristics of people in high power conditions versus people in low power conditions lead to the following hypothesis:

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given a Self-justification (versus no justification), whereas low power individuals' engagement in unethical behavior is not influenced by the availability of such justifications.

Other-justifications. An other-justification is a piece of information that enables an individual to justify its unethical behavior in order to appear moral to others and to avoid consequences that could accompany such behavior (Rus et al., 2012). Thus, an individual’s need for other-justifications is based on the possibility of being held accountable. The concept of accountability was defined by Lerner and Tetlock, who explained accountability as “the implicit or explicit expectation that one may be called in to justify one’s beliefs, feelings or actions to others.” (Lerner & Tetlock, 1999: 255). Consequently, in the current research, an other-justification is interpreted as a piece of information that defines the absence of accountability.

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typically participate in self-serving behaviors like gambling, change their attitude to more responsible behavior when they become accountable by becoming a parent. Also the self-serving behavior of powerful leaders decreases when they become accountable, compared to those who are not (Rus et al., 2012).

Based on the past research, I expect the availability of an other-justification to influence the behavior of high power individuals. Low power individuals, on the other hand, already have a sense of accountability embedded in their behavioral decision making process, meaning that they thoroughly take into account how their actions could influence others or could be valued by them (Keltner et al., 2003). Moreover, Rus and colleagues (2012) found that the effect of accountability on powerful leaders, declined with reduced power. Therefore, I expect the availability of other-justifications not to have an influence on the (un)ethical behavior of low power individuals. Hence, I propose the following hypothesis:

H2: Power and the availability of (external) other-justifications will interact to influence immoral behavior, such that high power individuals are more likely to act unethical when they are given an Other-justification (versus no justification), whereas low power individuals' engagement in unethical behavior is not influenced by the availability of such justifications.

METHOD

Participants and Design

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other-justification vs. no-justification) between-subjects design. Regarding the compensation for their participation, participants could choose between a payment of 8€ or 4 Research Credits.

The experiment examined the influence of self-justifications and other-justifications on the relationship between power and unethical behavior. Within this experiment participants were randomly assigned to one of two power conditions to stimulate a feeling of being in charge of, or having to follow orders. In addition, the types of justifications were manipulated by making either an external, internal, no justification (with default) or no justification (without default) available for each participant.

Procedure and Manipulations

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After finishing the questionnaire, the experimenter told the participants that there was some waiting time that needed to be bridged until the other participants of the group were done with the questionnaire and that the experimenter had to set up the room for the group task. Therefore, participants would participate in another study “from a colleague” to make use of the waiting time until the group task began. In order to do so, participants each had to go into one of eight cubicles, each equipped with a computer, to take part in the experiment. This “other” study was the actual experiment, but participants did not know that until the debriefing afterwards. This “other” study was an adapted version of the dictator game it (e.g. DeCelles et al., 2012; Kahnemann, Knetsch & Thaler, 1986; Pillutla & Murnighan, 1995; Forsythe, Horowitz, Savin & Sefton, 1994; Fowler & Kam, 2007) where participants had to divide ten lottery tickets between themselves and a receiver and answer several questions about their allocation and their feelings about. In accordance with other research (van Dijk & Vermunt, 2000), the amount of self-awarded tickets in the dictator game, represented the operationalization of self-serving and thus unethical behavior. Participants behavior was interpreted as more unethical, the more tickets they allocated themselves.

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Participants who were assigned to the high-power condition read the following text after completing the questionnaire:

Based upon your scores and the scores of the other people in the lab on the former questionnaires, you are assigned to the role of MANAGER in the Tanagram task later in this session. As MANAGER, you are in charge of directing the subordinates in building something called a Tanagram from a set of Legos. You decide how to structure the process of building the Tanagram and the standards by which the work is to be evaluated. In addition, you will also evaluate the builders at the end of the session in a private questionnaire. Your evaluation will determine how a financial bonus will be divided between you and your builders. The builders will not have the opportunity to evaluate you. Thus, as a MANAGER, you will be in charge of directing the building, evaluating your subordinates, and determining the rewards you and your subordinates will receive.

In case of the assignment to the low-power condition, participants read the following text:

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Justification Manipulation. In the description of the dictator game participants read that the more tickets they would take for themselves, the higher their chances would be of winning one of two 50€ cash prices. In the beginning of this task, participants were told that they would be randomly assigned to a role as “allocator” or “receiver” of lottery tickets, but in fact they were all assigned to the role of an allocator (van Dijk & Vermunt, 2000). After participants were “allocated” to their role, they were assigned to one of four justification conditions, where each conditions showed an individual screen where participants could divide the lottery tickets. The assignment to one of the four justification conditions was random. The four justification manipulations were different designs of the way the participants could divide the lottery tickets and will be explained further in the following.

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Other-justification. In conformity with previous research (van Dijk & Vermunt, 2000; Kagel, Kim & Moser, 1996) we manipulated the availability of an other-justification by giving the respective participants the information that the receiver would not know the total amount of tickets that could be divided by the allocator. Specifically, the other-Justification screen showed a text box where participants could type in the number of tickets they wanted to keep for themselves. Above this text field it was highlighted that the receiver would NOT know how many tickets the allocator could divide. This piece of information gave participants the chance to award more tickets to themselves, while still appearing ethical to the receiver. As the receiver did not know the total amount of tickets, the participant (allocator) could still appear as a fair individual, who divided the tickets equal. In case of the no justification condition, participants saw the same text field as in the other-justification condition, but without any information if the receiver knows about the total amount of tickets that could be divided. This gave participants no possibility to divide the tickets unequally without risking to be perceived as an unethical person, who wanted to have an advantage in winning one of the two 50€ cash prices.

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“I don’t know”, they were excluded from the dataset, because the “fact” that the other person did not know the total amount of tickets could not have been played a role in the decision about the amount of tickets the respective participants chose to keep for themselves.

At the very end of the experiment participants were checked for suspicion. They were asked if they had any comments on the study and what they thought was the purpose of it. If participants stated that they saw a connection between the leadership questionnaire and the dictator game or that they thought/knew that there was no actual receiver, they were deleted from the dataset.

Finally, participants were informed that there was no group task and after a short debriefing received their payment/research credits and could leave the research lab.

RESULTS

Manipulation Checks

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role they were assigned to. This question was followed by four items (seven-point Likert Scales; 1 = not at all to 7 = very much, α = .96) which tested if the high power participants actually felt more powerful (Anderson & Berdahl, 2002; Galinsky et al., 2003; DeCelles et al., 2012). A one-way analysis of variance, which tested the difference of perceived power between the two conditions showed that high power participants felt more powerful (M = 5.99; SD = .86) than participants who were assigned to the low power condition (M = 1.95; SD = 1.21; F(2,250) = 933,57, p = .00).

The manipulation check for participants who were assigned to the other-justification condition resulted in the exclusion of eight participants, who did not pay attention if the receiver knew the total amount of lottery tickets. The check for suspicion at the end of the dictator game led to the exclusion of 19 participants, as their behavior was influenced by suspecting a connection between the role assignment and the dictator game or questioning the existence of the receiver. In addition, three participants were excluded because of missing data and another two because they were extreme outliers. The outliers were excluded after a check if they were more than three SD’s above or below of the mean of the tickets. In this case the two participants who were excluded chose “0” tickets for themselves. In total, 38 participants had to be excluded, leaving 216 participants in the dataset on which the following analysis was performed.

Statistical Assumptions

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tickets for themselves. Despite the statistical reason for their exclusion (see above), these two participants could be excluded because awarding no tickets for oneself implies that the respective participants did not read the instructions and were therefore not actively participating. Approximately normal distribution (fifth assumption) was given. Analysis revealed that the data was not normally distributed, but further analysis of Skewness and Kurtosis values showed that the data is still approximately normal distributed (Skewness z-score: .801; Kurtosis z-z-score: -1.78), as their z-scores lie within the range of -1.96 and +1.96. Furthermore, empirical research (Schmider, Ziegler, Danay, Beyer, & Bühner, 2010) has shown that the empirical type I error as well as the type II error remain constant when the assumption of normal distribution is violated. The same research also found that the factor “type of distribution” is not significant regarding the interpretation of the ANOVA results. The sixth assumption again was not violated, as the Levene’s test of equality of error variances was not significant [F(7, 208) = 1.87, p = .08)].

Analysis

The general hypothesis that high-power individuals act more unethical (keep more tickets for themselves), when they have a justification available, was tested with two-way ANOVAs. In order to confirm the two hypotheses regarding the influence of 1. a self-justification and 2. an other-self-justification on the unethical behavior of power holders, significant differences in the amount of tickets taken, should be observed between the respective groups that had a justification available versus those who did not. Further there should not be a significant effect of either of the justification conditions on the behavior of low power participants, to show that the availability of a justification only influences power holders.

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unethical behavior (the amount of tickets taken). It was tested if the availability of a self-justification leads high power participants to take more tickets for themselves, compared to those who did not have a justification available (but a default set to a 50-50 allocation). In addition, the effect of a self-justification on the behavior of low power participants was examined in order to check if the influence differs in different power conditions. In line with hypothesis 1, analysis revealed a significant interaction between power condition and justification condition for the amount of tickets that the participants chose to award to themselves, [F (1,106) = 6.92, p = .01; see Table 1]. Neither the main effect of power [F (1,106) = 1.28, p = .26] nor of the self-justification condition [F (1, 106) = 1.61, p = .21; see Table 1] alone was significant.

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TABLE 1

ANOVA of power and self-justification on self-awarded tickets

Source df F p2 p Justification condition 1 1.61 .015 .21 Power condition 1 1.28 .012 .26 Power*Justification 1 6.92 .061 .01 Notes: R² = .071; N = 110

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TABLE 2

Means of self-awarded tickets by power condition and justification condition

High power Low power

Mean SD N Mean SD N Self-justification 7.08 1.88 38 6.50 2.09 20 No-justification default 5.57 1.02 14 7.03 1.92 38 Notes: N = 110

Hypothesis 2: Other-Justification vs. No-Justification. In order to test the second hypothesis, that the availability of an Other-justification enhances the unethical behavior of power holders, a two-way ANOVA was conducted. This two-way ANOVA tested the effect of power and the availability of an Other-justification on the amount of tickets that participants awarded themselves. The ANOVA-results did not show a significant main effect of the power condition [F (1,102) = 1.46, p = .23] or the justification condition [F (1, 102) = .07, p = .79]. In this case, the interaction effect between power condition and justification condition was also not significant [F (1, 102) = 0.53, p = .47; see Table 3].

TABLE 3

ANOVA of Power and Other-justification on self-awarded tickets

Source df F p2 p Justification condition 1 .07 .001 .79 Power condition 1 1.46 .014 .23 Power*Justification 1 .53 .005 .47 Notes: R² = .025; N = 106

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DISCUSSION

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This research convincingly showed that power holders act more unethical when they have a self-justification available, compared to when they have an other-justification or no justification available. This suggests that upholding a positive self-image is more important for power holders, than to appear moral to others. Thus I conclude that the possibility to see oneself as moral, despite violating against the own ethical standards, increases power holders’ engagement in unethical behavior. Moreover, the unethical behavior of power holders, who had no self-justification available, compared to their low power counterparts, suggests that having power itself cannot be the reason for people to engage in unethical behaviors. Instead, my findings show that the experience of power alone might even enable a moral identity/sense rather than corrupting it. This demonstrates how crucial the influence of self-justifications on the unethical behavior of power holders actually is, as their behavior without it turned out to be less unethical than the behavior of participants who did not experience power.

Theoretical Implications

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tickets that could be divided and therefore were not able to make use of the other-justification. This disproportionate number of participants made it impossible to interpret the respective part of the data. Consequently, it was not possible to compare their unethical behavior to those in the self-justification condition .

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moral norms. To sum it up, the influence of a self-justification depends on the strength of a power holder’s moral identity.

Limitations & Future Directions

Future research should pair my findings about self-justifications with the ones of DeCelles and colleagues (2012) in order to form an argumentative base for the examination of the influence of justifications on power holders’ unethical behavior, with respect to the strength of their moral identity, as the influence of the strength of one’s moral identity on unethical behavior has already been confirmed in various other studies (Reynolds & Ceranic, 2007; Aquino & Reed, 2002; Reed & Aquino, 2003; Aquino, Reed, Thau & Freeman, 2007; Aquino, Freeman, Reed, Lim & Felps, 2009). In addition, an effective manipulation of an other-justification condition could give insights on the interaction between the strength of a power holder’s moral identity and the availability of either a self- or an other-justification. Another argument which supports the idea that self-perception has an influence on unethical behavior of high power individuals is the finding of Fast and Chen (2009), who argued that power combined with self-perceived incompetence encourages leaders engagement in aggressive behaviors. Thus, it could also be interesting for future research to examine the effect of the availability of a self-justification on a power holder who perceives him- or herself either as competent or incompetent, on his or her engagement in unethical behavior.

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As all studies, my research also has its limitations. First it should be mentioned, that the population of this study was sufficient (N = 254) but due to complications with the assignment to the different justification conditions, the dispersion of the data was slightly skewed. However, statistical analysis confirmed that the data is still approximately normal distributed and thus could be analyzed without restrictions. The failed manipulation of the other-justification condition resulted in insignificant results in the analysis of the influence of other-justifications on power holders’ unethical behavior, which influenced the reliability of the finding that self-justifications have a greater impact on it. Due to the failed manipulation of the other-justification condition it was not possible to compare the influence of self- and other-justifications. Future research should investigate these two influences again, in order to create results for the influence of other-justifications which can be compared better to the influence of self-justifications. But the manipulation of the other-justification should be designed more obvious, so that participants will be more likely to make use of it.

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the research budgets of most universities. Nevertheless the current findings can be transferred to the “real world” as they show that it is not power itself that corrupts the minds of people, but the possibility to reinterpret unethical behavior in order to leave the moral self-perception unharmed. And the maintenance of a moral self-perception is something that all people strive for (Allport, 1955; Rosenberg, 1979). One should just keep in mind that even powerholders with high moral standards could turn into moral relativists when the reward for their unethical behavior is high enough.

Practical Implications

Nevertheless the current findings can be transferred to the “real world” as they show that it is not power itself that corrupts the minds of people, but the possibility to reinterpret unethical behavior (= self-justification) in order to leave the moral self-perception unharmed. And the maintenance of a moral self-perception is something that all people strive for (Allport, 1955; Rosenberg, 1979).

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that, managers on levels below them will adapt this behavior, as leaders influence their subordinates most efficiently by acting as role models (Brown et al. 2005; Walumbwa et al. 2011). Another way would be to incorporate a code of ethics in the organizations philosophy (Shalvi et al. 2015; Vitell et al., 2011). Organizations should formulate that code in a clear way and give guidance on how to interpret the behavioral rules that this code entails, even when they are already formulated explicitly. When this code of ethics is present in the everyday working life of an organization, its managers might incorporate it in their moral identity and thus it becomes less likely for them to be able to make use of self-justifications and therefore to act unethically, as it becomes harder for them to maintain their moral self-image.

To conclude

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