Is Group Loyalty a Force for Good or Evil?

Many organizations try to foster employee loyalty, but at a risk. Angus Hildreth, Francesca Gino, and Max Bazerman discover when group loyalty fosters ethical behavior—and when it fosters corruption.
by Michael Blanding

Most ethical principles are pretty unambiguously good. Honesty, fairness, compassion—sure they have their downsides (being “honest to a fault”), but that’s more a by-product of something good than it is something evil in and of itself.

Then there’s loyalty. While ostensibly a positive trait, we are much more apt these days to hear about loyalty in the context of problems—loyalty to a country or religion leading to fanatical acts of chauvinism or violence, loyalty to family or friends leading to nepotism and cronyism in government, or loyalty to co-workers or a company leading to cover-ups of financial chicanery or unethical dealings.

“Often what you are trying to do is create a sense of loyalty or trust in the firm, but that can make people so loyal that when they see something wrong they don’t bring it up”

That dichotomy presents a difficult challenge for senior managers. “Often what you are trying to do is create a sense of loyalty or trust in the firm,” says Tandon Family Professor Francesca Gino, a member of the Negotiation, Organizations & Markets unit at Harvard Business School. “But that can make people so loyal that when they see something wrong they don’t bring it up, or where they are crossing ethical boundaries for the good of their own group.”

Gino and colleagues write about this paradox in a new paper forthcoming in the journal Organizational Behavior and Human Decision Processes with a decidedly unambiguous title: Blind Loyalty? How Group Loyalty Makes Us See Evil or Engage in It. The paper—written with HBS colleague Max Bazerman, Jesse Isidor Straus Professor of Business Administration; and Angus Hildreth, a doctoral candidate studying organizational behavior at UC Berkeley’s Haas School of Business—has its origins in a conversation Bazerman and Hildreth had one day in Berkeley.

“We went to lunch and started arguing about moral philosophy,” says Hildreth, who had previously worked as a manager at a global accounting firm for eight years. “When you work in an organization, you sometimes face ethical dilemmas: Perhaps you are asked to interpret rules so that they benefit your company or client at the expense of others. You have to decide whether to do what you’re asked or refuse, which can be costly to you and your group,” explains Hildreth, talking on speakerphone in Gino’s office. “I saw loyalty as a good thing, because it prompts you to be a better person. Max disagreed, suggesting instead that loyalty has a dark side, since it causes people to make bad decisions.”

In Hildreth’s view, a strong sense of loyalty within individuals makes them more ethical, by sparking more noble impulses overall. “To me, loyalty is ethical in and of itself,” he says. “When we act out of a duty to loyalty we feel like our actions are ethical or moral even if they would conflict with what society prescribes as ethical.”

Back at Harvard, Bazerman talked to Gino about the exchange; Gino sided with Bazerman. “A lot of what I have done in my work on ethics is to study why good people do bad things,” she says. Even when people have good intentions, she notes, it can lead to bad outcomes. “Often we fail to appreciate when cumulatively our transgressions become something that becomes larger and potentially evil.”

Loyal employees can be good for a firm—until they fail
to report wrongdoing. ©iStock | Mediaphotos

Given their differing viewpoints, the three scholars saw an opportunity—to see who was right. “What is wonderful about being a behavioral scientist is that when you have debates, you can bring in empirical evidence,” Gino says. “Rather than just argue, you can look at the data.”

Putting loyalty to the test

The researchers arranged a simple experiment, in which participants were asked to solve a series of number puzzles. Rather than handing in their results, however, they were allowed to score themselves and recycle their answer sheets, just reporting the number of puzzles they got right. To sweeten the pot, participants were told they could earn 25 cents for themselves for each problem they got right, along with 25 cents for each member of their randomly preassigned group.

“We wanted to create conditions in which the choice to cheat was tempting, where monitoring seemed absent, and where there was a clear benefit from cheating,” says Gino. “That seems to approximate reality, in terms of the real perils that exist within an organization.”

Unbeknownst to the participants, however, the sheets they thought they recycled were actually collected by the researchers. Each had an identification number embedded in the puzzle that could be used to identify the participant and whether they were telling the truth about the number they’d completed.

Finally, before completing each puzzle, some participants were given an additional task—to discuss the idea of loyalty for 10 minutes with other members of their group and then take a “loyalty pledge” to the group. (The other participants just discussed a neutral topic for 10 minutes in their groups.)

When they tallied the results, Gino, Bazerman, and Hildreth found that of those participants who took the loyalty pledge, 20 percent had cheated.. But for those who didn’t take the pledge, more than twice as many—44 percent—had cheated.

In a follow-up experiment, participants were given an envelope full of money and were told to pay themselves for completed puzzles, giving the remainder of the money back to the experimenters. In that experiment, the results were even starker—15 percent who took the pledge cheated, compared to 43 percent who didn’t.

It appeared that Hildreth was right. Loyalty prompted people to act more ethically.

“We started seeing that loyalty to a group highlights the importance of ethical principles, so it brings people’s attention to the fact that behaving ethically is the right course of action,” says Gino.

In these experiments, however, participants were put in a group with strangers. What would happen if the researchers upped the stakes by pairing them with members of a group for which they already felt loyalty? “The reason we kept going with more and more studies was that Max and I really, really didn’t want to be proven wrong,” laughs Gino.

Liberty, fraternity, loyalty

For the next series of studies, the researchers recruited members of three college fraternities—organizations in which loyalty to one’s brothers is of the utmost importance. A week before conducting the experiment, they questioned the men, asking them how loyal they felt to the fraternity, and how likely they were to turn in a fellow brother for unethical behavior.

They were then given the same experiment as the previous participants, with a few changes: They could earn up to $20 for their fraternity for solving the puzzles correctly, and they were competing against two other fraternities for the chance to win a $200 prize for the most correct answers. Despite that increased temptation, Gino, Bazerman, and Hildreth found that brothers who said they were more loyal and more willing to turn in an errant brother actually cheated less. Hildreth was right again. Once again loyalty made people act more ethically.

In an effort to increase the stakes even further, the researchers ran the experiment again, except this time they added another twist. Four different fraternities took part, each knowing that the other three were competing, too. Before the experiment, each brother received a note from his house president. In some cases, the note read, simply, “Please take these tasks seriously. Good luck!” For others, the note was a much longer call to action, specifically referencing the competition with the other houses, and adding, in bold and underlined, “It is a tough competition, but I know we can win.

When Gino, Bazerman, and Hildreth tallied the results this time, they noticed a different pattern of results depending on the note the brothers had received. For those receiving the first note, the brothers more loyal to the fraternity were once again about half as likely to cheat compared to less loyal brothers—a difference of 23 to 55 percent. But when given the specific call to action, the opposite was true. Strongly loyal brothers cheated at a rate of 66 percent, compared to only 42 percent for those who were less loyal.

For the first time, in other words, loyalty actually increased unethical behavior rather than decreasing it as it had in the other experiments. In this case, Bazerman and Gino were finally right.

Loyalty as a force for good—or evil

When it comes to deciding whether loyalty is good or bad, it seems, that call demanding a specific action is all-important, the researchers surmise. “We were both right,” says Hildreth. “We provided evidence suggesting loyalty can be a good thing, but there is a big caveat, which is beware when you tell people what their loyalty demands because that can have a strong blinding aspect to it.”

In the case of the fraternities, Hildreth continues, that blinding force of loyalty can crowd out other positive considerations. “When I am surrounded by my loyal brothers, I am thinking about related traits, like honor and honesty and integrity,” he says. “I care about my group’s image. But at the moment I am told this is what your loyalty demands—for example, competing with other groups to win at all costs—suddenly those traits don’t matter anymore. Loyalty forces you to focus in on your goal.”

That Achilles’ heel of loyalty is one that managers need to be conscious of in creating the values within an organization.

“We have the opportunity to use loyalty for good, but we need to be clear what the goals are we are stressing when people work in groups,” says Gino, who was happy to be proven wrong about the positive aspects of loyalty, even as the ultimate vision of loyalty emerging from these experiments proved more complex. “Rather than just focusing on group goals, we need to stress higher principles—that there may be goals that need to be advanced over group goals.”

That’s all the more important, adds Hildreth, since unlike in these experiments when participants had to make a conscious choice to cheat, loyalty in organizations can result in engaging in unethical actions through inaction—by allowing others to cheat without blowing the whistle.

“If you are promoting the value of loyalty, it may be that you need to promote other values at the same time, like fairness and integrity,” he says.

As effective as loyalty can be in promoting other positive behaviors, Hildreth concedes, “Loyalty in isolation can be a dark thing.”

About the Author

Michael Blanding is a writer based in Brookline, Massachusetts

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