Psychological Egoism and Corporate Culture

Psychological Egoism and Corporate Culture

Psychological egoism refers to the theory, based on observations of human behavior, that the motives behind all actions and decisions which encompass human behavior is to benefit their own welfare (lander.edu, 2009). In the last decade, the news has been rife with painfully real tales of psychological egoism running riot in the corporate world and high level executives eventually being placed under arrest. A very infamous and public scandal which involved psychological egoism resulting in ethical dilemmas handled in favor of greed was the case of the Tyco looting. Chief executive officer (CEO) L. Dennis Kozlowski and chief financial officer (CFO) Mark H. Swartz were escorted out of Tyco company headquarters in handcuffs. The charges were that they had stolen millions upon millions of dollars and a range of charges such as grand larceny, enterprise corruption and the falsification of business records (unm.edu). The psychological egoism generally revolved around a sense of entitlement, Kozowski and Swartz felt entitled to spending company money to fund a lavish and lush lifestyle at the office and at their homes. The two engaged in a range of violations from writing themselves personal loans from company money, top using funds to throw ornate and fabulously expensive birthday parties for relatives.

The ethical dilemma of how to resist the copious amounts of money that one had access to as a high level executive was generally lost out to the act of indulging in greed and the power of money. This is a clear dynamic that can too easily occur with fundamental levels of an individual's psychological egoism.

There is a definitely a way that the decision-making process within a large corporation can overcome this aspect of human selfishness. This can occur with corporate monitoring boards who are well-versed in the red flags of moral meltdowns which can occur on the corporate level. For example, things like a culture of silence, pressure to "maintain those numbers, a weak board, radical "innovation" and excessive goodness in certain areas to atone for evil and greed in others are all classic signs that a corporation is giving in to the executives fundamental level of psychological egoism and some serious poaching of company funds is likely occurring (Jennings, 2006). Having a consistent system of regulation in place as a well as a commitment to transparency are all clear ways that a corporation can prevent a culture of greed from taking over and offers a potential solution to the issue.