A Conversational Guide to Unethical Behaviour in Companies and the Psychology Behind It

The idea of "evil" in the business world might sound dramatic, but it’s a concept worth unpacking. In corporate settings, evil doesn’t necessarily show up as overt criminal activity or cartoonish villainy. More often, it’s subtle and insidious, manifesting as practices that exploit workers, deceive consumers, harm the environment, or perpetuate systemic inequities. Recognizing these behaviors requires a keen eye and an understanding of the psychological forces that allow them to thrive.

So, let’s explore what these harmful practices look like, how to spot them, and the mental mechanisms that keep them alive in organizations. The goal is to be more aware, whether you're a consumer, an employee, or even part of the leadership team in a company.

What Does "Evil" Look Like in a Company?

Evil in a corporate context is all about harm. Sometimes it’s directed at employees—think low wages, unsafe conditions, or relentless overwork. Other times, the target is consumers, who might be misled by false advertising or manipulated into buying products they don’t need. Then there’s harm on a larger scale: environmental destruction, unchecked corruption, or creating cultures that marginalize entire groups of people based on race, gender, or other identities.

The troubling thing is that these actions often don’t look blatantly unethical at first glance. A company might market itself as a sustainability champion while quietly dumping waste into rivers. Or a leader might talk about valuing diversity while quietly promoting the same kind of people over and over again. That’s why it’s so important to stay curious and observant.

How Can You Tell When a Company’s Doing Harm?

Let’s start with some of the warning signs. When a company is being less than ethical, it often shows up in patterns of behaviour. You might notice that leadership avoids transparency, making big decisions in the shadows or refusing to share financial or operational details. Maybe employees seem overworked and undervalued—long hours, high turnover, and burnout could be the norm. Or perhaps the company treats marginalized groups unfairly, like paying women less than men or systematically overlooking people of color for leadership roles.

In marketing and public relations, deception is another red flag. Companies might exaggerate the benefits of their products, hide potential harms, or use manipulative tactics to create a false sense of urgency. This can extend to how they treat customers, especially vulnerable ones. Think of payday lenders who prey on people struggling financially, or tech companies designing products to be addictive rather than helpful.

Environmental negligence is another big one. If a company’s sustainability practices feel like greenwashing—when their efforts to appear eco-friendly are just for show—it’s worth digging deeper. Are they genuinely committed to reducing their footprint, or are they simply masking harmful behaviors with clever PR?

And let’s not forget the human element. Toxic leadership can be a huge driver of unethical behavior. If you see leaders who micromanage through fear, take credit for others’ work, or seem more focused on their own power and status than the company’s mission, that’s a huge warning sign. Cultures of fear and manipulation don’t just harm employees—they enable all kinds of harmful practices to flourish unchecked.

Why Do These Behaviours Happen? Understanding the Psychology

The thing about harmful corporate behaviour is that it often doesn’t start with outright malicious intent. Instead, it’s shaped by psychological forces that allow individuals and organizations to justify their actions, even when those actions cause harm.

One common factor is cognitive dissonance. People don’t like feeling that their actions conflict with their values, so they’ll find ways to rationalize unethical behavior. For example, a manager who underpays employees might convince themselves that it’s necessary for the company’s survival, even though they know it’s unfair.

Another big one is groupthink. When people in organizations prioritize harmony and conformity over critical thinking, it can lead to poor decision-making. Imagine a group of executives greenlighting an unethical marketing strategy simply because no one wants to rock the boat. The pressure to conform can silence dissent, even when individuals know something is wrong.

Sometimes, people simply disengage from the morality of their actions. Psychologist Albert Bandura called this moral disengagement—a way of mentally distancing yourself from the consequences of your choices. A CEO who cuts environmental corners might justify it by saying, “Everyone in our industry does it,” effectively passing the moral buck.

Leadership personalities also play a role. Traits like narcissism or psychopathy are surprisingly common in the corporate world, especially in leadership roles. Narcissistic leaders, for instance, might see employees as tools to serve their own ambitions, while psychopaths might lack the empathy to care about the harm their actions cause. These leaders can create cultures where exploitation and manipulation aren’t just tolerated—they’re rewarded.

Finally, there’s temporal discounting, where people prioritize short-term gains over long-term consequences. This is especially relevant in environmental issues. Leaders might focus on hitting next quarter’s profit targets while ignoring the fact that their practices are destroying ecosystems or contributing to climate change. After all, the damage won’t show up immediately—and by the time it does, they might have moved on to another company.

Why Does This Matter to You?

Understanding the psychological underpinnings of these behaviors helps us move beyond just calling out “bad apples” and look at the bigger systems at play. When you recognize the signs of unethical practices and understand why they happen, you can make more informed decisions—whether it’s choosing where to work, what to buy, or how to hold companies accountable.

Let’s say you’re job hunting. You notice that a company’s employees frequently complain about long hours and poor treatment on sites like Glassdoor, or the company has a history of discrimination lawsuits. That’s a red flag. Similarly, as a consumer, if you see a brand making big claims about sustainability but refusing to disclose details about their supply chain, that’s worth questioning.

Even within a company, this awareness can empower you to push back against harmful practices. Many unethical actions continue simply because no one speaks up. By understanding the forces at play—like groupthink or moral disengagement—you’re better equipped to challenge them constructively.

How Do We Address These Problems?

Fixing these issues requires action at multiple levels. Ethical leadership is crucial. Leaders need to cultivate transparency, empathy, and accountability, making it clear that profits shouldn’t come at the expense of people or the planet. Employees also need safe ways to speak up when they see something wrong. Whether it’s anonymous reporting systems or simply a culture that values dissent, companies should empower individuals to call out unethical behaviour.

For consumers, supporting companies that prioritize long-term sustainability and fairness is one way to create change. When businesses see that ethical practices matter to their customers, they’re more likely to act accordingly.

Ultimately, this is about shifting perspectives. Instead of focusing only on short-term gains, companies—and the people within them—need to take a broader view of their impact. What kind of legacy are they leaving? Are they creating value for everyone, or just for a select few?

Simply Put

Spotting evil practices in companies isn’t always straightforward. The signs might be subtle, and the justifications for harm can seem reasonable on the surface. But by staying alert, asking questions, and understanding the psychology behind these behaviours, you can play a part in holding companies accountable. Whether you’re an employee, a leader, or a consumer, awareness is the first step toward creating a world where businesses don’t just aim for profit—they aim for integrity, too.