When Good People Normalize Bad Systems: Leadership, Ethics, and Institutional Drift
Leadership failure does not always begin with people who lack values. It often begins when institutions gently teach otherwise decent people which values can be bent, postponed, or ignored in order to belong, survive, or succeed. Over time, leaders learn not just how the system works, but also what the system truly rewards.
When the Barrel Trains the Apple
Imagine a new department head joining a respected organization. On paper, the institution prizes transparency, accountability, and care for the people it serves. In practice, the newcomer quickly learns a different lesson. When someone raises an uncomfortable concern, the issue is “managed” in closed rooms, and the messenger is gradually moved aside. When numbers look bad, teams are praised for finding “creative” solutions that smooth out the story.
Research on the normalization of corruption in organizations shows how this happens in three steps. First, small rule-bending becomes institutionalized as routines and informal policies. Next, people develop rationalizations to make it feel acceptable. Finally, newcomers are socialized into these patterns, often by mentors who calmly signpost what really counts. The Chartered Institute of Personnel and Development’s review of “rotten apples, bad barrels, and sticky situations” captures this phenomenon well: good people placed in bad barrels, under intense pressure, start behaving in ways they never planned.
From One Exception to the New Normal
Most normalization does not start with a grand conspiracy. It starts with “just this once.” Leaders bend a procurement rule to meet a deadline, soften a report “until we have more data,” or overlook a conflict of interest because “we need this partner on our side.” A classic analysis of the normalization of corruption in organizations describes how repeated exceptions become templates, then habits, and then norms.
Recent commentary warns of the danger when organizations begin to normalize unethical behaviors, treating them as clever adaptations rather than red flags. Over time, what once felt like a compromise starts to feel like “how the game is played.” Leaders who object are told they are naïve, disloyal, or “not commercially minded.” Slowly, the system retrains their moral instincts.
How Organizations Help People Switch Off Their Conscience
Moral psychology calls this process moral disengagement. Instead of holding themselves to their usual standards, people learn to switch those standards off in specific contexts, using familiar mental shortcuts: “No one really gets hurt,” “If I don’t do it, someone else will,” or “Head office wants the numbers, not the excuses.” A multi-functional review of moral disengagement mechanisms explains how diffused responsibility, euphemistic language, and distance from consequences make it easier for otherwise decent people to participate in harmful systems.
Work on unethical companies and organizational moral disengagement shows how entire cultures can become skilled at telling these stories to themselves. Employees learn which topics to avoid, which jokes are safe, and which questions mark someone out as “not a team player.” After enough repetition, people are no longer just surviving the system; they are helping to sustain it.
When Institutions Betray the Trust They Were Given
For those who joined because they believed in the institution’s mission, this slow shift feels like a form of betrayal. Work on institutional betrayal describes the harm people experience when organizations that promised safety, justice, or care mishandle wrongdoing, silence dissent, or protect reputations over people. Studies on antidotes to institutional betrayal and broken trust highlight how repeated failures to act with integrity erode psychological safety, engagement, and willingness to report concerns.
At that point, good people often face a new moral dilemma: stay and adapt, stay and resist, or leave. Some gradually lower their standards to keep their jobs. Others burn out in lonely resistance. A few exit, carrying with them a deep suspicion of institutions that talk values and reward the opposite. This is where institutional trust enters the story.
Signs that Good People Are Normalizing a Bad System
Because normalization is gradual, leaders need practical indicators that something is shifting. Research on unethical behavior in workplaces and on the normalization of corruption in organizations suggests several warning signs:
Jokes or sarcasm become the main way people talk about serious ethical concerns, signaling discomfort without change.
Phrases like “this is how things work here” or “you have to be realistic” are used to shut down principled questions.
Those who raise uncomfortable truths are sidelined, while those who “keep things smooth” are promoted.
Policies and values statements remain unchanged, but informal workarounds are widely understood and rarely challenged.
People who once said, “I would never…” now describe questionable practices as “just part of the job.”
If several of these patterns are present, the issue is no longer a few bad actors. The barrel is teaching the apples.
Questions for Leaders: Are You Being Trained to Lower Your Standards?
If you care about values, the most important question is not “Do I have values?” but “What is this system teaching me to live with?” These questions may help:
What did you once consider non-negotiable that now feels negotiable in your current role? How did that shift happen?
Which practices in your organization make you uneasy, and what explanations are used to calm that discomfort?
Who seems to pay the price when someone insists on doing the right thing at the wrong time? What story does that tell others?
If a trusted friend watched your decisions over the last year, would they say the system is sharpening your moral judgment or slowly dulling it?
Conclusion: Restoring Integrity in the System
When good people normalize bad systems, the result is not only individual compromise but institutional betrayal of the trust they were given. The next frontier for values-based leadership is not simply producing more ethical individuals; it is redesigning systems so that belonging and success do not require the slow lowering of one’s standards.
Babatunde Oladele is a doctoral researcher in Leadership focused on values-based leadership, institutional trust, and moral authority in public and organizational life. His work examines how leaders form values over time and how those values influence decision-making, legitimacy, and accountability under pressure. He writes Leadership & Values, a weekly column on leadership across political, civic, educational, and organizational contexts.
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