The Hidden Cost of Ethical Behavior

Ethical behavior is widely promoted as essential for organizational health, personal integrity, and societal trust. However, what is often overlooked are the hidden costs that individuals may incur when they choose to act ethically in environments where unethical behavior is normalized or rewarded. These costs can be tangible—such as lost promotions, financial gains, or professional opportunities—or intangible, including social isolation, retaliation, or moral fatigue.

Ethical individuals may face career stagnation when refusing to engage in practices like falsifying reports, overlooking discrimination, or supporting questionable leadership decisions (Treviño, Weaver, & Reynolds, 2006). For example, whistleblowers often act in accordance with moral principles, yet they frequently suffer career damage, strained relationships, or emotional distress (Near & Miceli, 2016). In contrast, those who acquiesce to unethical norms may be perceived as more loyal, cooperative, or pragmatic, thereby gaining access to power, resources, or social capital within the organization (Kish-Gephart, Harrison, & Treviño, 2010).

Moreover, ethical behavior in a corrupt or misaligned system can lead to moral dissonance—a psychological burden created when acting in opposition to prevailing group behaviors (Bandura, 1999). Those who uphold integrity may be seen as troublemakers or nonconformists, especially in high-pressure environments where results are valued over methods. Consequently, ethical behavior, while morally right, may come at a cost to the individual’s well-being or professional trajectory.

These lessons were taught to me throughout my career in law enforcement. As a young police officer, I was both active on the street and within the officer’s union. I was a member of the Political Action Committee (PAC), and we were in the middle of contract negotiations. Many of the officers were not happy with how things were going in the negotiations, and the PAC committee was actively arguing against the proposed contract. At the same time, the department had also been in the process of creating the new position of Corporal, which would be a formal leadership position within the department. The Corporal would replace the “Assistant Squad Leader.”  I had just enough time and education to meet the minimum qualifications for the Corporal position, so I applied. After completing all of the written and oral examinations, I was placed on the eligibility list, tied for number two out of almost forty other officers who had applied. I was stoked! I had a good reputation within the department and had no disciplinary issues, so it looked pretty promising.

What are your ethics worth?

One day as I came in from my shift, my sergeant came up to me and asked if we could talk privately for a minute. We stepped into a nearby interview room and the sergeant said, “Congratulations, for doing so well on the Corporal list. Captain ‘L’ wants to make sure you are a ‘team player’ and he wants this contract to go through. So, if you can show him that you are on the ‘management’ team and help this contract go through, then he will make sure you get on ‘our team.’”  As I stood there, I could not believe that this specific sergeant was saying this to me because I had a lot of respect for him and always thought he was an ethical person.

It didn’t take me very long to think about the ethical choice I had to make and I said, “Well, Sarge, I am currently playing for the [union] team, but if Captain ‘L’ wants me on his team, then he can put me on his team and I’ll play for the management team. Until then, I am going to continue playing on the team I’m currently on.”  A week later, the promotion list was released. Everyone ranked from number 1 to number 16, including several other PAC members and the person I tied at number 2, were promoted along with one officer who had been ranked in the 30s. I was the only person in the top 17 candidates who was not promoted. I recognized the ethical choice immediately and knew that it may not turn out like I had hoped, but I have never regretted making that decision.

This is one of several examples of the cost of behaving ethically that I learned from my time in law enforcement, including a few more incidents with this particular Captain. It was a stark realization that my ethical choices had a hidden cost associated with them. Unfortunately, there are many more to use as examples and many I would rather not remember.

Conclusion

Recognizing the hidden costs of ethical behavior does not diminish its value; rather, it underscores the profound importance of creating environments that reinforce and sustain ethical conduct. The potential sacrifices individuals make when choosing integrity over conformity—whether career advancement, peer acceptance, or financial gain—highlight the urgency for systems that do more than merely discourage unethical actions. Organizations must actively design cultures and policies that reward moral courage, provide safe avenues for reporting wrongdoing, and establish protections against retaliation.

Leadership plays a pivotal role in modeling ethical decision-making and reinforcing a values-based culture where ethical behavior is aligned with both individual and organizational success (Brown & Treviño, 2006). When ethical actions are consistently recognized, supported, and embedded in the operational fabric of an organization, individuals are far more likely to act with integrity, even in the face of personal risk. In this way, ethics becomes not only a personal responsibility but a shared organizational asset—one that fuels trust, credibility, and sustainable performance.

References

• Bandura, A. (1999). Moral disengagement in the perpetration of inhumanities. Personality and Social Psychology Review, 3(3), 193–209. https://doi.org/10.1207/s15327957pspr0303_3

• Kish-Gephart, J. J., Harrison, D. A., & Treviño, L. K. (2010). Bad apples, bad cases, and bad barrels: Meta-analytic evidence about sources of unethical decisions at work. Journal of Applied Psychology, 95(1), 1–31. https://doi.org/10.1037/a0017103

• Near, J. P., & Miceli, M. P. (2016). After the wrongdoing: What managers should know about whistleblowing. Business Horizons, 59(1), 105–114. https://doi.org/10.1016/j.bushor.2015.09.007

• Treviño, L. K., Weaver, G. R., & Reynolds, S. J. (2006). Behavioral ethics in organizations: A review. Journal of Management, 32(6), 951–990. https://doi.org/10.1177/0149206306294258