Corporate culture: poison for whistleblowers

From The Whistle (Newsletter of Whistleblowers Australia), March 1997, pp. 1-2

Brian Martin

Whistleblowers can readily understand other whistleblowers. They have seen a problem and spoken out about it. They know when something is wrong and are simply doing the right thing by trying to correct it.

On the other hand, often it is not so easy for whistleblowers to understand why others don't react the same way. Why do co-workers sit by and do nothing?

Why do top managers try to cover up the problem? It is tempting to say that such co-workers are "gutless" or that such managers are "corrupt". But that doesn't help to explain why they behave the way they do. How do they perceive the problem? How do they justify their behaviour? What do they really think about whistleblowers?

Most books about bureaucracies don't provide much insight into these issues.

Finally I've found one that does. It is by Robert Jackall and titled Moral Mazes: The World of Corporate Managers (Oxford University Press, 1988).

Jackall obtained access to a couple of big US corporations as well as a public relations firm. He spent many months interviewing managers and watching them in action, as well as reading many documents.

Jackall treated the world of corporate managers as a culture. He was like an anthropologist studying an alien tribe. His aim was to understand the social dynamics of corporate culture. He gives many case studies of activities and crises to illustrate his analysis.

Moral Mazes can be heavy-going at times, as some of the quotes below indicate. But it is worth persisting with the book because of the insights it offers. Unfortunately, Jackall just describes corporate life and doesn't give any suggestions on how to change it.

Here are some of his important insights.

  • Corporations are in a constant state of upheaval. When a new executive takes over a post, he (or occasionally she) brings in a whole new crew of cronies. Bureaucracy is a set of networks of patronage.
  • Corporations often respond to the whims and inclinations of the chief executive. Even an off-hand comment by the chief executive can trigger subordinates into intense activity to do what they think is being suggested. In many cases the result is ill-advised or disastrous.
  • Conformity is enforced to amazingly fine details.
  • Managers, to be successful, must continually adapt their personalities to adjust to the current situation. This is not just acting. They must become so natural at what they do that they "are" their act. Much of this adaptation is fitting in. Clothes must conform to expectations, but so must speech, attitudes and personal style. Those who don't adapt don't get ahead.
  • Managers don't want to act until the decision is generally accepted. They experience a pervasive indecisiveness. Each one looks for signals on what decision will be favoured. Signals from the boss are especially important.
  • Responsibility is diffused and hard to pin down. Managers avoid taking responsibility. The key thing is to avoid being blamed for a failure.
  • Morality is doing what seems appropriate in the situation to get things done. Morality is doing what the boss wants. Having absolute principles is a prescription for career stagnation or disaster.
  • The symbolic manipulation of reality is pervasive. For any decision, managers discuss various reasons in order to settle on a way to give legitimacy for what the corporation does.
  • Public relations is simply a tool. Truth is irrelevant.

The successful manager is one who can adapt to the prevailing ideas, who can please the boss, who can avoid being blamed for failure, and who can build alliances with supporters above and below.

Jackall devotes a chapter, "Drawing lines", to the corporation's response to whistleblowers. White was a health professional who tried to raise concern about hearing loss among many workers at a corporation's textile mills. He collected data and wrote a report. Due to his professional training and religious background, he felt this was a clear moral issue. But his attempts failed. He did not have supporters higher up. As well, his recommendations for change threatened powerful interests. Other managers felt uncomfortable with White's moral stance. "Without clear authoritative sanctions, moral viewpoints threaten others within an organization by making claims on them that might impede their ability to read the drift of social situations. As a result, independent morally evaluative judgments get subordinated to the social intricacies of the bureaucratic workplace ... Managers know that in the organization right and wrong get decided by those with enough clout to make their views stick." (p. 105). White ended up leaving the company.

Brady was an accountant who found various discrepancies in a company's financial operations. At one stage, "Brady discussed the matter with a close friend, a man who had no defined position but considerable influence in the company and access to the highest circles in the organization. He was Mr. Fixit - a lobbyist, a front man, an all-around factotum, a man who knew how to get things done." This friend took Brady's anonymous memorandum to a meeting of top figures in the corporation. "Immediately after the meeting, Brady's friend was fired and escorted from the building by armed guards." (p. 108). Brady now realised it was the chief executive himself who was fiddling the books. Brady was under suspicion of having written the memo. He eventually presented all his evidence to the company's chief lawyer, who wouldn't touch it. "Right after Brady's boss returned from Europe, Brady was summarily fired and he and his belongings were literally thrown out of the company building." (p. 109).

Nothing new here. Another whistleblower is dismissed. What is most interesting in Jackall's account is his description of how other managers saw the situation. They saw "Brady's dilemma as devoid of moral or ethical content. In their view, the issues that Brady raises are, first of all, simply practical matters. His basic failing was, first, that he violated the fundamental rules of bureaucratic life. These are usually stated as a series of admonitions. (1) You never go around your boss. (2) You tell your boss what he wants to hear, even when your boss claims that he wants dissenting views. (3) If your boss wants something dropped, you drop it. (4) You are sensitive to your boss's wishes so that you anticipate what he wants; you don't force him, in other words, to act as boss. (5) Your job is not to report something that your boss does not want reported, but rather to cover it up. You do what your job requires, and you keep your mouth shut." (pp. 109-110).

The second response of managers to Brady's case was that he had plenty of ways to justify not acting. Others obviously knew about the fiddling of the books but did nothing. They were all playing the game. Why should Brady worry about it? He would only make himself vulnerable.

The third response of managers was to say that those things that Brady got upset about - "irregular payments, doctored invoices, shuffling numbers in accounts" - were ordinary things in a corporation. "Moreover, as managers see it, playing sleight of hand with the monetary value of inventories, post- or pre-dating memoranda or invoices, tucking or squirreling large sums of money away to pull them out of one's hat at an opportune moment are all part and parcel of managing a large corporation where interpretations of performance, not necessarily performance itself, decide one's fate." (p. 110).

The fourth and final response of managers to Brady's case was to say that he shouldn't have acted on a moral code that had no relevance to the organisation. "Brady refused to recognize, in the view of the managers that I interviewed, that 'truth' is socially defined, not absolute, and that therefore compromise, about anything and everything, is not moral defeat, as Brady seems to feel, but simply an inevitable fact of organizational life.

They see this as the key reason why Brady's bosses did him in. And they too would do him in without any qualms. Managers, they say, do not want evangelists working for them." (p. 111).

After all these events, the chief executive - the one who fiddled the books - retired, elevated his loyal lieutenant to his former position and took an honorary position in the firm, as head of internal audit.

Concerning this case, Jackall concludes: "Bureaucracy transforms all moral issues into immediately practical concerns. A moral judgment based on a professional ethic makes little sense in a world where the etiquette of authority relationships and the necessity of protecting and covering for one's boss, one's network, and oneself supersede all other considerations and where nonaccountability for action is the norm." (p. 111).

Jackall's analysis is based on just a few US corporations. He had to approach dozens of corporations - and adapt his pitch - before he found a couple that granted access. There is no easy way of knowing which of his insights apply to other corporations, other types of bureaucracies, and in other countries. But in as much as the same sorts of dynamics occur, Jackall's examination shows that whistleblowers are up against something much bigger than a few corrupt individuals, or even a system of corruption. The problem is the very structure of the organisation, in which managers who adapt to the ethos of pragmatism and who please their bosses are the ones who get ahead. To eliminate wrongdoing in corporations requires not just replacing or penalising a few individuals, but changing the entire organisational structure. It is the structure, within the wider corporate culture, that shapes the psychology of managers and creates the context for problems to occur.

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