Cultural Toxicity: A Systemic Phenomenon, Diagnosing Causes, and Creating Safe, Inclusive Workplaces
Introduction
Organisational culture is the key factor that defines the experience of the employees; however, in its destructive form, it quickly kills the trust, kills creativity, and boosts turnover. This widespread issue should be diagnosed by employing a systemic examination of the underlying ideas that explain the process of toxic formation, reinforcement, and maintenance. The current discussion uses the three basic conceptual frameworks, which are Misaligned Rewards, Social Exchange, and Organizational Silence, to explore the underlying factors of toxicity, as well as outline the possible intervention of Human Resources (HR) in a systematic way.
Diagnosing Systemic Toxicity
Systemic toxicity establishes itself, provided structural and social processes that are interconnected and can be explained by known conceptual frameworks:
1. The Model of Misaligned Rewards: Reinforcing the Wrong Outcomes
The conceptual model focuses on the fact that incentive structures guide behaviour. The principle of On the Folly of Rewarding A while Hopping B (1975) by Steven Kerr is the classical example of incentive systems that tend to encourage undesirable behavior since the measured parameters that receive a reward are not the same as the ethical achievement that should be the goal. This misalignment of the structure forms a toxic point of pressure.
The effects of such misalignment were easily portrayed in the case of Wells Fargo (U.S. Department of Justice, 2020), in which ambitious impractical sales goals forced the employees, through the organizational structure, to create millions of unapproved accounts. This accident shows how the incentive system has made the deviant behavior the most reasonable route to payments.
2. The Model of Social Exchange: Replicating Tolerated Misconduct
The Social Exchange model holds that in social interaction, there is an exchange of goods with compliance being strengthened where there is a benefit in the course of an interaction (Blau, 1964). Therefore, when unethical or aggressive behaviour by leaders is condoned or even encouraged,(Kerr, 1975) it implies that such behaviour is not wrong and employees will mimic this behaviour in the interest of success or in order to fit into a perceived group norm. In this way, the toxic behaviour is spread around the organisation and institutionalised.
This is what was practiced in the culture at Uber when the former CEO Travis Kalanick practiced harassment as an institution. The fact that the organisation did not punish the high-performing and unethical leaders represented that the behaviour was a viable social exchange. The following turnaround needed a shift in leadership to indicate new moral principles, which proactively reformed this social agreement (Mauri, 2024).
3. The Model of Organizational Silence: Sustaining the Silence
Organizational Silence model refers to a group phenomenon where the employees knowingly withhold information or issues, and they do so usually due to a fear of adverse consequences (Nafei, 2016). This silence makes sure that issues are continued to exist. Fear of employees in a toxic environment results in mass silence directly. This process ensures that systems enforce toxic behaviours that are acceptable in society (Blau,1964), and tolerated by systems (Kerr, 1975), and increases staff turnover (Nafei, 2016).
HR Intervention Strategies
The key change agent is the HR, which is expected to implement specific, systemic interventions to break every one of the identified mechanisms.
1. Countering Misaligned Rewards
To disrupt the structural drivers, HR must audit and adjust incentive mechanisms:
- Performance Review Audit: The HR should revisit and amend incentive systems to clearly incentivise integrity and ethical behaviour in addition to the results. This will necessitate the elimination of redundant measurements that encourage shortcuts (e.g., in the case of Wells Fargo) and the articulation of performance contracts on the acceptable way of attaining results.
- Making Ethical Expectations Clear: Every job description and performance contract should expressly say that ethical compliance is an irreplaceable element in the reward exchange and therefore structural vagueness should be avoided.
2. Countering Social Exchange & Replication
In order to break the social reinforcement, the HR should aim at implementing accountability and establishing new norms:
- Tracing Accountability: The HR is expected to exercise disciplinary action in an apparent manner whenever ethical boundaries are violated regardless of the level of the employee or performance effectiveness. This will make the cost of toxic behaviour instantaneously high, which violates the negative social exchange contract.
- Ethical Leader Development: It is essential to require every management to participate in training, which would be based on inclusive leadership and ethical modelling. This guarantees that new and favourable behaviours are exhibited at the highest level, which is actively resetting the cultural norms (Mauri, 2024).
3. Countering Organizational Silence
In order to break the cycle of toxicity, HR has to ease the fear and employee voice:
- Introduce Independent Channels: HR should also institute the third-party reporting systems and hotlines which will enable employees to report issues anonymously. This directly responds to fear of negative outcomes that contributes to organisational silence.
- Whistleblower Protection: Publicly commit to and strictly implement no-retaliation policies. The Microsoft compliance framework (2021) provides a framework of how to build trust through protecting the employees as they come forward, thus disrupting the organisational silence.
Conclusion
Toxic organisational cultures are structural and systemic failures that are based on structural and social mechanisms. Improving perverse incentive structure (Kerr, 1975), imposing accountability to disturb tolerated social exchange (Blau, 1964), and the facilitation of employee voice to shatter the silence in the organisation (Nafei, 2016), the HR can take a decisive step into a safe, ethical, and high-performing workplace.
References
Blau, P.M. (1964) Exchange and Power in Social Life. [PDF] Available at: [https://ia601504.us.archive.org/31/items/in.ernet.dli.2015.118920/2015.118920.Exchange-And-Power-In-Social-Life_text.pdf](https://ia601504.us.archive.org/31/items/in.ernet.dli.2015.118920/2015.118920.Exchange-And-Power-In-Social-Life_text.pdf) (Accessed 19 Nov 2025).
Kerr, S. (1975) ‘On the folly of rewarding A, while hoping for B’, Academy of Management Journal, 18(4), pp. 769–783. Available at: [https://web.mit.edu/curhan/www/docs/Articles/15341_Readings/Motivation/Kerr_Folly_of_rewarding_A_while_hoping_for_B.pdf](https://web.mit.edu/curhan/www/docs/Articles/15341_Readings/Motivation/Kerr_Folly_of_rewarding_A_while_hoping_for_B.pdf) (Accessed 19 Nov 2025).
Mauri, T. (2024) The Upside of Disruption: The Path to Leading and Thriving in the Unknown. Available at: [https://wartimeceostories.com/p/the-wartime-ceo-strategy-of-uber-ceo-dara-khosrowshahi](https://wartimeceostories.com/p/the-wartime-ceo-strategy-of-uber-ceo-dara-khosrowshahi) (Accessed 19 Nov 2025).
Microsoft (2021) Legal Compliance and Ethics. Available at: [https://www.microsoft.com/en-us/legal/compliance](https://www.microsoft.com/en-us/legal/compliance) (Accessed 19 Nov 2025).
Nafei, W.A. (2016) ‘Organizational Silence: A Barrier to Job Engagement in Successful Organizations’. [PDF] Available at: [https://www.paperpublications.org/upload/book/EMPLOYEE%20SILENCE%20AND%20ORGANISATION-23112022-4.pdf](https://www.paperpublications.org/upload/book/EMPLOYEE%20SILENCE%20AND%20ORGANISATION-23112022-4.pdf) (Accessed 19 Nov 2025).
U.S. Department of Justice (2020) Wells Fargo to pay $3 billion to resolve criminal and civil investigations of sales practices. Available at: [https://www.justice.gov/archives/opa/pr/wells-fargo-agrees-pay-3-billion-resolve-criminal-and-civil-investigations-sales-practices](https://www.justice.gov/archives/opa/pr/wells-fargo-agrees-pay-3-billion-resolve-criminal-and-civil-investigations-sales-practices) (Accessed 19 Nov 2025).
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ReplyDeleteThis assignment provides a comprehensive and insightful analysis of cultural toxicity within organizations. By employing the conceptual frameworks of Misaligned Rewards, Social Exchange, and Organizational Silence, it effectively diagnoses the systemic roots of toxic behaviour and clearly illustrates these with real-world examples such as Wells Fargo and Uber. I particularly appreciate the structured approach to HR interventions, emphasizing the role of ethical performance incentives, accountability mechanisms, and avenues for employee voice. The discussion underscores the criticality of aligning organizational structures and social norms with ethical standards to foster safe and inclusive workplaces. As highlighted, 'Toxic organisational cultures are structural and systemic failures that are based on structural and social mechanisms,' which reinforces the importance of proactive HR strategies. Overall, the assignment successfully bridges theory with practical application, demonstrating a clear understanding of the complexity of workplace toxicity and the essential role of HR in mitigating it
ReplyDeleteThank you so much for your detailed and insightful feedback.
DeleteThis is an excellent article. You have discussed how cultural toxicity develops through systemic mechanisms such as misaligned rewards, social exchange dynamics, and organizational silence. And also, you have discussed outlined practical HR intervention strategies that address these root causes, offering a structured and insightful approach to creating healthier, ethical, and inclusive workplace cultures. Furthermore, you have discussed strong real-world examples to illustrate how toxic behaviours become reinforced and normalised.
ReplyDeleteThank you so much for your detailed and insightful feedback.
DeleteDear Sarika, Toxic organizational cultures emerge when structural and social processes align to reinforce unethical or counterproductive behavior. Misaligned rewards, as exemplified by Steven Kerr’s principle of “On the Folly of Rewarding A while Hoping for B,” can push employees toward harmful shortcuts, as seen in the Wells Fargo scandal. Social exchange dynamics further propagate toxicity when unethical behavior is tolerated or rewarded, creating norms that employees emulate, a phenomenon evident in Uber’s past leadership culture. Organizational silence compounds the problem, as fear of retaliation discourages employees from reporting issues, allowing harmful practices to persist unchecked. Together, these mechanisms increase turnover, erode trust, and stifle creativity across organizations.
ReplyDeleteHuman Resources plays a critical role in reversing systemic toxicity by implementing targeted interventions. Addressing misaligned rewards requires auditing incentive structures to reward ethical behavior alongside performance outcomes and clarifying ethical expectations in job roles. Countering destructive social exchange involves establishing accountability for all levels, promoting ethical leadership, and resetting cultural norms through training. Breaking organizational silence necessitates independent reporting channels, anonymous hotlines, and robust whistleblower protections, modeled after frameworks like Microsoft’s compliance system. By strategically targeting these structural and social drivers, HR can transform toxic workplaces into ethical, safe, and high-performing environments that foster trust, engagement, and sustainable organizational success.
Thank you so much for your detailed and insightful feedback.
DeleteThis is an incredibly insightful and thorough post! 🌟 I really appreciate how you’ve broken down cultural toxicity into clear frameworks like Misaligned Rewards, Social Exchange, and Organizational Silence—it makes such a complex topic tangible and actionable. The real-world examples, like Wells Fargo and Uber, really drive home how systemic these issues can be, and how HR intervention is not just helpful but essential.
ReplyDeleteI’m curious—based on your research and experience, which HR interventions tend to have the most immediate impact in shifting a toxic culture, and which require a longer-term, sustained effort? It would be fascinating to hear your thoughts on how organisations can balance quick wins with deep systemic change.
Thanks for sharing such a practical and thought-provoking guide—it really highlights that creating a safe and ethical workplace is a collective, ongoing effort.
I would like to note that your feedback is quite detailed, and I am glad that frameworks and examples speak to you.
DeleteIn relation to your question, some of the HR interventions are more likely to build immediate shifts than others:
The misconduct should be accounted to regularly to show that no longer the toxic behaviours are accepted. Quick sources of anonymous reporting quickly eliminate the fear and revive the employee voice.
Re-designing reward systems requires time but a total change of behaviour. Ethical leadership needs time to develop and requires constant reinforcement.
In the majority of organisations, a combination of quick wins in order to regain trust is needed, as well as structural changes conducted on a deeper level to maintain a healthy culture. Again thank you very much, for the detailed comment
This is a well-structured and insightful analysis that highlights how toxic cultures develop through misaligned rewards, tolerated misconduct, and organisational silence. I appreciate how the discussion connects theory with real-world cases and offers practical HR interventions that address the issue systemically rather than superficially. A strong and thoughtful piece on building safer, more ethical workplaces.
ReplyDeleteThank you for the feedback
Delete