Keywords

Introduction

The term “toxic leadership” was first coined by Jean Lipman-Blumen in 2005. A number of research papers since then have focused on the unethical behaviors of some leaders and managers, and explored the associated “dark” characteristics, such as narcissism, Machiavellianism and psychopathy. The topic has been given extra relevance by corporate scandals, such as Enron, Tyco and Worldcom. Reflecting on the role of business education in these scandals, Ghoshal (2005) wrote that “by propagating ideologically inspired amoral theories, business schools have actively freed their students from any sense of moral responsibility” (p. 76).

This chapter reviews the academic literature on the dark side of leadership, explores the possible origins of the apparent rise of toxic leadership and asks whether shining a light on toxic behaviors is likely to inhibit these practices, or whether this exposure may simply reinforce and habituate them.

Toxic Leadership

While Lipman-Blumen (2005) is credited with coining the term “toxic leadership” she was not the first to shine a light on the dark side of leadership behavior. Adorno et al. (1950) put forward the idea of the authoritarian personality and its negative influence on the behaviors of leaders in organization. Christie and Geiss (1970) developed the concept of Machiavellianbehaviors and attitudes of leaders in organizations. Kets de Vries (1985) identified a “dark side” in some entrepreneurs, which manifests itself in particular as their business grows: with a strong need for control, a suspicion of others and a desire for social approval, such people can suffer mood swings and make poor assessments of events, leading to bad decisions and mistakes. Conger (1990) discussed the dark side of visionary leadership, and the way some leaders may seek to manipulate others through impression management and communication skills.

Lipman-Blumen (2005) defined toxic leaders by reference principally to their destructive behaviors:

those individuals who, by virtue of their destructive behaviours and their dysfunctionalpersonal qualitiesor characteristics, inflict serious and enduringharmon the individuals, groups, organizations, communities and even the nations that they lead. (p. 2, emphasis in original)

Thoroughgood et al. (2012a) distinguish between destructive leader behavior (bad behavior by an individual) anddestructive leadership (a process that is damaging to the group and organization). They say “destructive leadershipentailscontrol, coercion and manipulation” (p. 899) and is essentially selfish in nature.

Higgs (2009) reviews the literature on “bad” leadership and suggests the central themes are behaviors that involve (1) abuse of power, (2) inflicting damage on others, (3) over-exercise of control to satisfy personal needs, and (4) rule-breaking to serve one’s own purpose.

Thoroughgood et al. (2012b), in a piece of inductive research, identify a range of behaviors that are perceived by employees to constitute destructive leader behavior, including those directed against subordinates, those that disadvantage the organization and those related to sexual harassment. The behaviors range from open criticism of others to ignoring phone calls or emails, and discounting feedback or advice from subordinates; behaviors disadvantaging the organization include stealing, and otherwise breaking the law while at work.

Three main reasons are put forward for the increasing interest in the dark side of leadership. First are the studies of derailment, which identified patterns of behavior that derailed the careers of hitherto promising and successful executives. Kaiser et al. (2015) suggest the origins of this research lie in the 30-year study of failed executives in the US retail chain, Sears, Roebuck and Company by Bentz (1967, 1985), which influenced further studies in the 1980s on managerial derailment at the Center for Creative Leadership (McCall and Lombardo 1983). Derailment is usually associated with executives failing before they reach the top of their organization, but Kets de Vries (1989) asked what makes some leaders “derail” when they reach chief executive positions. He argued that despite the considerable pressures that come with this position, some individuals are able to “stay in touch with reality” (p. 7) whereas personality factors mean that others are not able to do so.

Two other reasons have been proposed as stimulants of interest in this area: Schyns and Schilling (2013) argue that interest in patterns of destructive leader behavior has been sparked by evidence that abusive supervision is commonplace, and has damaging effects on employees. Finally, the prominent failure of large organizations such as Enron, Tyco and Worldcom which caused Ghoshal (2005) to lament the amoralmanagementeducation provided by business schools has also been linked to a greater interest in the dark side of senior executives’ behavior and character (Higgs 2009).

Bentz’s (1985) analysis led him to the conclusion that the underlying cause of failure for the Sears, Roebuck executives was related to personality defects. The derailment studies at the Center for Creative Leadership also identified certain negative personality factors, and this stimulated increasing interest in dark side traits from the 1980s onward (Benson and Campbell 2007; Harms et al. 2011; Kaiser et al. 2015). Studies of destructive leader behavior quickly moved beyond identifying harmfulbehavior patterns into considering underlying causes in the personalities of leaders (Hogan et al. 1994; Goldman 2006).

One of the main approaches to identifying the personality factors that give rise to toxic leadership focuses on the “dark triad” of narcissism, Machiavellianism and psychopathy (Paulhus and Williams 2002; Schyns 2015; Boddy et al. Chap. 4 in this volume; Flanigan, Chap. 5 in this volume). The other common approach is the 11 dark side personality dimensions framework developed by Hogan Assessment Systems (Hogan and Hogan 2001).

Dark Personality Traits

In researching personality traits that are associated with toxic leadership, writers have drawn on the ideas and language used to describe clinical personality disorders, but as Paulhus (2014) explains, in the organizational context these are

socially offensive traits falling in the normal or “everyday” range. Rather than being incarcerated or under clinical supervision, such individuals manage to survive, and even flourish, in everyday society. (p. 421)

These are “not clinical personality disorders because they do not impair significant life functioning as required for a clinical diagnosis” (Kaiser et al. 2015, p. 58).

The “dark triad” of the traits of narcissism, Machiavellianism and psychopathy is one of the main frameworks used in this context. The traits are seen as presenting along a continuum, so that an individual may be high, medium or low in each of them (Fatfouta 2019). Paulhus (2014) argues that high scores in these traits are marked by a common lack of empathy or a “callousness” regarding the welfare of others, but in other respects they are quite different.

High narcissists are characterized by “grandiosity, arrogance, self-absorption, entitlement, fragile self-esteem, and hostility” (Rosenthal and Pittinsky 2006, p. 671). High narcissists continually seek attention (Paulhus 2014) and exhibit “an unusually high level of self-love, believing that they are uniquely special and entitled to praise and admiration” (Judge et al. 2009). It is argued that narcissism entails a clash between a grandiose projection of identity and underlying feelings of inferiority and insecurity (Jones and Paulhus 2014; Kets de Vries 2014), which can lead to narcissists being hypersensitive to criticism (Rosenthal and Pittinsky 2006). However, narcissism is also associated with charismatic and visionary leadership that can inspire others (Maccoby 2000) and enable leaders to act confidently (Kets de Vries 2014).

Machiavellianism is named after Niccolo Machiavelli, the sixteenth-century Florentine author of The prince, a commentary on the acquisition and use of political power (Christie and Geis 1970). The key elements of Machiavellianism are manipulativeness, a lack of empathy, and a calculating and instrumental approach to relationships (Jones and Paulhus 2014). Those high in Machiavellianism are unethical, dishonest, seek to enhance their own power and are motivated by the prospect of personal benefit (Judge et al. 2009).

Subclinical psychopathy, exhibited by “corporate psychopaths” (Boddy 2015; Boddy et al., Chap. 4 in this volume), is typified by a lack of conscience. Corporate psychopaths “have been referred to as successful psychopaths due to their ability to avoid confrontation with legal authorities” (Cheang and Appelbaum 2015a, p. 167). They behave in abusive, impulsive ways toward others. Behaviors include “glibness, manipulativeness, extreme dishonesty, and grandiosity … lack of empathy, lack of emotion and affect, lack of remorse, and a failure to accept responsibility” (Cheang and Appelbaum 2015b, p. 237).

In an alternative approach, the 11 traits in the Hogan Assessment Systems framework are aligned to the Axis II personality disorders defined in the Diagnostic and Statistical Manual of Mental Disorders IV, published by the American Psychiatric Association (APA2000) but, as with the dark triad, they are conceived as operating in a subclinical form, as part of normal personality. The traits are excitable, cautious, skeptical, reserved, leisurely, bold, mischievous, colorful, imaginative, diligent and dutiful (Hogan and Hogan 1997; Harms et al. 2011; Furnham et al. 2012; Gaddis and Foster 2015). There are close similarities between three of these traits and the dark triad traits: between bold and narcissism, mischievous and psychopathy, and skeptical and Machiavellianism.

Other approaches to identifying or defining dark traits include the study of hubris, “overconfidence mixed with excessive pride” (Picone et al. 2014, p. 447). Leaders high in hubris overestimate their own abilities, ignore advice from others and set overambitious goals (Sadler-Smith et al. 2017; Sadler-Smith 2019).

Effects of Dark Personality Traits

An emerging area for discussion has been theeffect of these dark personality traits on the success and effectiveness of leaders. They were identified from the 1980s onward, as factors that give rise to destructive behavior, failure and derailment (Hogan and Hogan 2001; Harms et al. 2011), yet they have been observed to be common among managers, including those at executive level, and therefore have not damaged the careers of these individuals, at least not in the short term (Babiak and Hare 2006; Babiak et al. 2010; Boddy 2015; Kaiser et al. 2015; Flanigan, Chap. 5 in this volume). Kets de Vries and Balazs (2011) state that “[a] solid dose of narcissism is a prerequisite for anyone who hopes to rise to the top of an organization” (p. 389). In a similar vein, Lipman-Blumen (2005, p. 2) argues that “saints are not likely to elbow their way to the front of the leadership queue”. Those high in corporate psychopathy “present well and look good” (Boddy 2015, p. 2410) and high narcissists “come across as assertive, competent, and likeable at short-term acquaintance” (Fatfouta 2019, p. 4). Grijalva et al. (2015) found that extraverted narcissism was positively related to leader emergence (i.e. being appointed to leadership positions) but that high levels of narcissism were negatively related to performance: “narcissists generally make a positive first impression, as others preliminarily perceive them to be charming and self-confident; but over time more negative qualities such as arrogance, exploitativeness, and self-centeredness damage narcissists’ relationships” (Grijalva et al. 2015, p. 3). Den Hartog et al. (2020) suggest that

those high on narcissism tend to more often emerge as leaders in groups because they possess traits such as authority, confidence, dominance, decisiveness, and high self-esteem, which are the ingredients people tend to look for in a leader. … However, while narcissism relates positively to leader emergence, overall it does not relate positively to leader effectiveness. (p. 264)

Grijalva et al. (2015) observe that, while the Center for Creative Leadership studies on derailment made no explicit reference to narcissism, many of the characteristics that gave rise to derailment overlapped core elements of narcissism, such as being insensitive, cold, aloof, arrogant, betraying trust and being overly ambitious. Benson and Campbell (2007) view the “derailing traits” as factors affecting leadership performance that may be effective in the short term, but “ultimately erode trust and support from those around the leader and become dysfunctional in the long term” (p. 236). Schyns (2015, p. 5) argues that high narcissism is

linked to bad decision-making (due to overconfidence and impulsivity), higher counterproductive work behaviour, inflated self-ratings, as well as lower performance where performance is linked to maintaining positive relationships.

Focusing on corporate psychopaths, Cheang and Appelbaum (2015a) give the example of Foxconn, a company where a number of employees committed suicide in 2010, citing their fear of the abusivebehavior of their managers. Boddy (2015) relates abuses in healthcare organizations to corporate psychopaths, and also comments that “[f]inancial insiders as well as psychologists and management researchers agree that corporate psychopaths within banks were linked to the global financial crisis” (p. 2413). Claxton et al. (2015) identify hubris in the behavior of the CEO of Lehman Brothers.

Other examples of abusivebehavior by senior managers include the case of France Télécom, where a court found that 19 employees committed suicide between 2008 and 2011, and 12 attempted suicide. Three senior managers, including the chief executive of the company at the time, were found guilty in court of running a callous campaign of psychologicalharassment against employees (Waters 2020). Other recent cases of unethical executive behavior include the scandal that emerged in 2015 involving Volkswagen, where the company programmed the software of diesel cars to cheat emissions tests. In the USA, recent court cases concerned senior executives in pharmaceutical companies who illegally conspired to increase sales of addictive medications (e.g. Emanuel and Thomas 2019). The collapse of Steinhoff International Holdings in 2017, at that time one of the largest retailers in the world, has been attributed to the overambitious and unethical actions of a small team of senior managers, led by a charismatic CEO (Naudé et al. 2018) displaying classic symptoms of hubris. Since 2017 the #metoo movement has revealed widespread sexual harassment in the workplace by senior managers against more junior members of their companies or industries.

The dark personality traits are linked with selfishness, callousness and unethical behavior. Narcissism and hubris also influence the leader’s decision-making capabilities. Maccoby (2000) argues that narcissists can fail to analyze situations realistically and may take too many risks in order to expand: They can be “out of touch with reality” (p. 75). Risk-taking is also a consequence of hubris. Picone et al. (2014, p. 450) argue that “individuals affected by hubris lose contact with reality”.

However, some writers have explored the potential positive effects of leaders with dark traits. Maccoby (2000) suggested that there is a type of “productive narcissist” who is potentially positive and effective—such people are visionaries who can inspire others. Fatfouta (2019) provides a list of positive and negative narcissistbehaviors, from analyses of published papers. Judge et al. (2009) also suggest that moderate levels of “dark side” traits can aid leader effectiveness. Grijalva et al. (2015) reviewed a range of studies of narcissism and leadership, some of which found that narcissism was positive to leadership performance, while others found that it was negative. Grijalva et al. (2015, p. 18) conclude that “narcissism is a potentially positive trait, when it is expressed in moderation”. Benson and Campbell (2007) also argue there is a nonlinear relationship between “dark side” personality traits and leadership performance: too little or too much of a dark trait can be damaging to performance, but there is an optimum, middle level that can give rise to effective behavior.

Kaiser et al. (2015), using the Hogan dimensions, also found that high or low degrees of dark-side traits were associated withineffective leadership behaviors, but that a mid-range of dark-side traits was associated witheffective leadership behaviors. They argue that whether “dark-side” characteristics have positive or negative effects may depend on (1) the strength of the characteristic; (2) the extent to which the individual feels under threat (which makes them more likely to revert to the characteristic under pressure); and (3) the ability of the individual to self-regulate. They argue that individuals high on emotional stability (a recognized personality trait) are more likely to be able to self-regulate.

Contexts for Toxic Leadership

While researchers have focused to a great extent on the behavior and characteristics of toxic leaders, it is accepted that the context in which they operate, and the behavior of those whom they lead, contribute to developing and sustaining their destructive behavior. Lipman-Blumen (2005) sought to make the main issue of her paper the reasons why followers so frequently accept, favor and even create toxic leaders. She suggested that we look to leaders to fulfill psychological needs, or to cope with situational fears, and we get taken in by the grand illusions set out by toxic leaders. When they let us down, we rationalize why we can’t resist them.

Padilla et al. (2007) talk of a triangle of leader dispositions, susceptible followers and conducive environments. Conducive environments include instability, perceived threat, cultural values (such as those that promote avoidance of uncertainty, collectivism and high power distance) and absence of checks and balances on a leader’s power. It is argued that the pride and overconfidence associated with hubris are boosted by previous success and by occupying a position of power (Sadler-Smith et al. 2017) and with an absence of checks and balances (Claxton et al. 2015).

Susceptible followers have been categorized as “conformers” (people who go along with the destructive leader out of fear) or “colluders” (those who are attracted by the prospect of personal advantage) (Padilla et al. 2007). Thoroughgood et al. (2012a) expanded this taxonomy: types of conformers are described as “Lost Souls”, “Bystanders” and “Authoritarians”; types of Colluders are called “Acolytes” and “Opportunists”.

Distance may also influence follower support. Nevicka et al. (2018) found that when followers were socially distant from their leader, they perceived

leader narcissism was positively related to perceived leadership effectiveness and job attitudes. However, when followers had more opportunity to observe their leader, the positive relationship disappeared. (p. 703)

Why Are There So Many Toxic Leaders?

Organizational leadership, by nature, involves influencing others to carry out actions they might not otherwise undertake, ostensibly for the good of the organization. It is not always possible to proceed by consensus on what needs doing or how to achieve it, and sometimes leaders need to use their power to press for a particular course of action (Flanigan, Chap. 5 in this volume). There are inevitable inequalities of power between leaders and others, and this provides opportunities for leaders to abuse their position to behave destructively toward individuals and organizations.

A certain proportion of people with the dark traits discussed in this chapter are interested in the power and other privileges that accrue to leaders. Narcissists and corporate psychopaths may charm and scheme their way into leadership positions. High Machiavellians may be promoted to such positions when they prove themselves adept in situations requiring negotiation, complexity and strategy. Research into executive derailment revealed patterns of managers who were initially judged to be successful, and so were placed in positions of responsibility, only later to demonstrate damaging weaknesses.

How many toxic leaders are there? There is a dearth of reliable statistics. Three studies cited by Schyns and Schilling (2013) found that, in the Netherlands, 11% of employees had experienced destructive leadership, in a study in the USA the proportion was 14% and in research in Norway 33% of respondents had “often” experienced it. Boddy (2015) cites three very small studies that indicate subclinical psychopaths are more common in senior executive positions than in the population at large. Beyond these statistics are individual examples: the 2019 annual report for the Institute of Crisis Management, for example, found that in the previous year an increasing number of senior executives left their post for “inappropriate behavior”, including the CEOs of Texas Instruments, Intel and Nissan, and eight senior executives had been dismissed for sexual misconduct, including at CBS and Disney (ICM2019, p. 5).

Are toxic leaders in organizations any more common today than they were 60 years ago? In many Western professional organizations, there is an expectation of less directive, more consultative leadership now than there was then, and in many countries there are more protections for workers’ rights. Yet abusive leaders still gain and hold power, with damaging consequences for the people who work for them, and sometimes for the organizations they lead. Some individuals exploit the opportunities for abuse of power that exist in many management positions, with the additional dynamic in more modern times, in the West, of growing inequality that has given rise to a sense of entitlement. Increasing business complexity may also increase opportunities for covert unethical behavior.

Shining a Light on Toxic Leadership

Will shining a light on toxic leadership inhibit its practices? Or will this exposure simply reinforce and habituate these toxic behaviors? It is difficult to assess the impact of the prosecution of a senior executive on the motivation of other executives who are high in narcissism, psychopathy, Machiavellianism or hubris: perhaps the lesson they will draw from the experience of those who appear in court is to be sure to avoid apprehension. However, the value of shining a light on this toxic behavior may be that it alerts those who structure corporate environments, and those who work within them.

Where checks and balances can be put in place—where it is not too late—they may help senior executives keep “in touch with reality” (Kets de Vries 1989, p. 15). Strengthening governance arrangements may protect organizations from the excesses of warped individual decision-making. Strengthening grievance procedures may have some impact on abusive managerial behavior. Help can be provided to leaders enduring the potential destabilizing effects of a volatile business environment (Padilla et al. 2007; Goldman 2006).

Those who recruit and select others to leadership positions should take warning of the dangerous charm of the high narcissist and the corporate psychopath who can excel in interviews through their “excellent communication and lying skills” (Babiak et al. 2010, p. 190), but who have “less substance behind this façade than first appears” (Boddy 2015, p. 2410). Such charm can be counteracted by taking measures such as placing a greater emphasis on assessing results of past performance—examining hard facts and figures—gathering feedback from individuals’ line managers, colleagues and subordinates, and more use of probationary periods in new posts (Fatfouta 2019).

Where individuals with dangerous or destructive traits are willing to change, organizations may have success in providing guidance and support for development. Part of the Center for Creative Leadership work on derailment includes a detailed example of how an abrasive and self-centered executive was helped to change their patterns of behavior (Lombardo and Eichinger 1989). Goldman (2006) provides a detailed case study of a highly talented executive with borderline personality disorder—which involves instability and impulsivity—who undertook development and learned to manage his mood swings and destructive impulses. Kets de Vries (2014) also provides case studies of how individual senior executives were helped to manage their dark characteristics. Each of these examples features feedback from work colleagues, acceptance by the individual of the need to change and extensive one-to-one development work.