Ethics in Organizations: the Unconscious at Work

Part Two
By Annabel Beerel, MBA, PhD

Acting Chair, Sabbatical Replacement
Christos and Mary Papoutsy Distinguished Chair in Ethics
Southern New Hampshire University


Having raised several critiques about the current state of ethics education I now propose a different approach to teaching ethics that includes both a shift in content and in pedagogy compared with common current practice. My beginning point is what I see as the predominant goal of ethics education. Thereafter I describe how this can be achieved by broadening the content of what is taught and changing the emphasis of how ethics is taught.

Finding the Hidden Wholeness

The goals for ethics education are most frequently cited as raising awareness, helping students recognize ethical issues, exposing students to ethical thinking, cultivating new attitudes, stimulating moral imagination, and encouraging moral courage. Some courses claim to focus on the goal of “knowing thyself” and one’s own moral values and thresholds so that one can participate with a higher level of consciousness in ethical issues (Sims 2002, 17-20).

I align with the latter goal. In fact, I venture even further by proposing that the goal of ethics education is to actively transform people’s consciousness. The emphasis on transformation in education is wonderfully described in Platos’ Protagoras where Socrates asks of Hippocrates, who is planning to become a pupil of Protagoras, “What will he make of you?” I hold that the supreme goal of ethics education lies in this question. Ethics education while being informative by providing the language of ethics, for example, should also be transformative. While all real learning is transformative, in ethics education we are particularly concerned with the results of that transformation.

Transformation itself usually results from rigorous self-examination with the purpose of understanding one’s deeper self so that one can better integrate one’s inner and outer worlds. Transformation raises the question: What has it made of me? How do I now understand who I am and what I do in a way that is coherent and makes sense to me? Do I have a better sense of my limits and my potential? In what way does this lead me to live a more integrated and therefore responsible life?
The goal of ethics education in my opinion is therefore to move toward what Thomas Merton describes as our “hidden wholeness” where wholeness includes all of us, both light and the shadow, along with our constant struggle with that inner war.7


The Psychological Lens

A growing portion of the professional literature in ethics claims to take an inter-disciplinary approach to ethics education. Despite the inclusion of more disciplines, the role of psychology remains minimal. In my experience, a genuine moral attitude can only be born out of reverence for both the mental and emotional tussles we experience when making choices, especially difficult ones. To really understand human behavior, (the subject of morality), therefore, I argue that ethics education requires greater inclusion of a psychological lens.

The psychological lens that I propose, and that I use in my ethics classes, is referred to as depth psychology. Depth psychology is concerned with both the conscious and unconscious mental and emotional processes that influence our dispositions and our behavior. The insights of depth psychology provide us with a means to move beyond the futile ambition and requirement of moral perfection. Depth psychology encourages us to honestly deal with all of our human nature, both good and bad, where the highest value is not the attainment of perfection but authentic integration (Neumann, 1990, 4). The use of depth psychology thus gets us away from the dualistic approach to ethics described above, to a more realistic appreciation of the human moral condition. This appreciation does not advocate moral leniency but rather moral realism and pursuit of that “hidden wholeness.”

Some people are skeptical about the notion of the unconscious and would not consider it a valuable subject of study. I believe that for those who take that position valuable teaching opportunities are lost. My study of Jungian psychology and of Group Relations Theory as developed by the Tavistock Clinic in the United Kingdom brought my attention to the unconscious or “the shadow” as Jung refers to it, and its relevance to our moral lives. Whatever initial skepticism I had, and there certainly was some, has long disappeared after nine years of using the Group Relations approach in my Leadership and Ethics classes. Through the use of an experiential pedagogy, which is also part of the Tavistock approach, and which I describe later, one can observe the participation of individuals’ and groups’ unconscious clearly at work. Before I provide an example of the unconscious at work let us review Jung’s concept of the shadow.

Embracing the Shadow

From the moment we are born, our family and our society inculcate certain values that give us the foundation of good and bad in ourselves. Needing love of others and a sense of self-esteem we cultivate what is rewarded as good and exclude from our behavior and sense of self that which is disapproved of or seen as “bad.” We are thus taught to split good versus bad from early on. Jung discusses what becomes of this rejected part of our humanness. Because we choose to identify with light (communal values and approval) we banish from conscious awareness those parts of us that we do not want to be part of us. This disowned part of our nature Jung named the “shadow.”

The shadow includes those parts of us that we have shoved into the dark cavern of the unconscious – our hatred, rage, jealousy, greed, competition, lust, shame, and includes those eschewed by our culture – addiction, laziness, aggression, and dependency. The shadow also includes our unlived life; those positive qualities we are afraid to realize, and that part of us that from a young age we were discouraged from showing. These aspects might be our creativity, for women it might be their strength, and for men it might be their sensitivity. Whatever lies in our shadow is alive and well and waiting for expression.

The shadow includes both primitive and undeveloped parts of us that have never been conscious as well as those parts rejected by the ego. The ego is the conscious part of the psyche that directly controls thoughts and behavior, and that is most aware of external reality. For self-esteem the ego aligns with the values of the collective, community or group with which it identifies. Jung explains how this internal splitting has dire consequences. Banished from conscious awareness and control the shadow gains autonomous and often destructive power.

Due to the processes just explained, two psychic systems are formed in the personality, one of which remains unconscious, the shadow, while the other receives active support from the ego and the conscious mind, the façade personality. The façade personality or persona is the mask that conceals our real individual nature. The façade personality is the visible sign of agreement with the values of the collective, community, or group with whom we identify. Jung explains how the ego forgets it possesses aspects that run counter to the persona and imagines itself to be in harmony with the values of the collective. In order to do this the ego both suppresses and represses the shadow side. Suppression is the conscious pushing aside of thoughts, feelings, desires and motivations in an attempt to live up to the ethical ideal of the collective. Repression, occurs when thoughts, feelings, desires, and motivations are withdrawn from the control of consciousness and function independently of it. Repression is the more dangerous of the two as the forces and contents that are repressed change and become regressive causing more primitive reactions to be mobilized. These repressed parts of us lead to an active underground life of their own with usually disastrous results for both the individual and the collective.

Socrates’ appeal to his fellow citizens to examine their lives also calls us to examine not only the real light, that which is truly ours and not just a manifestation of our ego, but also what lies in the shadow. In the shadow lie our undeveloped attitudes, our unrealized potential and the unlived part of our lives. The examined life requires us to question, for example, when we feel so powerful, so confident, so competent, or so needed what has happened to our feelings of weakness, fear, incompetence, or lack of self-worth. Where in the shadows are these aspects of us lurking? Are our efforts always so well intended? Is the use of our power really always so benign? What might those difficult or inept people we are trying to manage or lead have to say to us? Where are our trigger points? What might we project onto others? Where do our fears and insecurities lie? What are our true limits and our true potentials? What would a transparent mosaic of our inner life look like? What motivates us and what do we fear?

Our shadow, like our light, is part of the real person who gets up every day, shows up to work and participates in the community. Avoiding questioning and examining, among other things, our fear of failure, our fear of not being or having enough, and our fear of being out of control will make us victim to these very parts that reside within us. We need to understand the enemy within so that we do not find reasons and ways to make someone out there the enemy and thereby create our own axis of evil! If we desire to use our skills and leadership talents to liberate rather than oppress, we need to acknowledge the inner tussle between our dark and our light side so that we can own that struggle and not project it onto others. It is this type of examination and reflection that leads to moral transformation.

Our moral problem, or the inner war described earlier, is the co-existence of ego and shadow. Just like St. Paul our well-meaning ethical intentions are torpedoed by the polar opposite - the reality and the influence of our shadow selves. We cannot, therefore discuss ethics and morality without understanding how our shadow side contributes to our efforts. In order to understand our conscious and unconscious processes we need to experience our dual nature. That experience needs to be part of ethics education.

A Shadow Tale

An example of the shadow in both the individual and the group might be helpful. I recently held a seminar for executives entitled Leading People: Leading Change. The goal of the seminar was to study the integration of Power, Leadership and Authority and its affect on Group Dynamics. Twelve people attended, five of whom were women. Of the twelve, eleven people had MBAs and two people with MBAs were company presidents. The age group ranged from thirty-eight to over sixty. The oldest member of the group, a woman, in her sixties, did not have an MBA or any other executive experience. She had come as a result of her boss’s insistence that she be exposed to some Leadership training.

In the afternoon of the first day the group of twelve was divided into three groups of four and given an exercise. Until this time the group had been together studying group dynamics and group behavior “real time.” The older woman, let us call her Susan, had not uttered one word throughout these sessions. Her sense of anxiety, intimidation and overwhelm in the presence of the other group members was palpable. In turn, the rest of the group ignored her, talking across her, not inviting her opinion and apparently not even noticing her silence and discomfort.

The goal of the afternoon exercise was for group members to practice systems thinking. Very briefly, this means viewing the world as composed of one large system or whole as well as a series of infinite smaller systems or wholes. Within these wholes patterns are recognizable and all parts of these systems are in some relationship with one another (Laszlo, 2002). In order to practice systems thinking each group was given a relationship to explore. For example one group was asked to consider the relationship between the Corporate Scandals and Suicide Bombers. Another group was asked to consider the relationship between the war in Iraq and the tsunami off the coast of Indonesia. Groups were given 30 minutes to discuss whether, how and why relationships between the events they were given to consider existed. At the end of the exercise the small groups reconvened as one large group to discuss their findings. As people drew up their chairs to reassume the large group seminar format the oldest male of the group said “And so Annabel, if everything is related to something else, who is the suicide bomber in this room?” I replied, “Interesting question!” Dead silence ensued. Obviously people were taken aback and uncomfortable with the prospect of a suicide bomber in their midst albeit only in metaphorical form. Suddenly, without warning, Susan, threw herself forward leaning far across the table and said: “Oh well, let me commit suicide and then you can all get on with it!”

No-one responded to Susan’s outburst. Her action and her comment were totally ignored. Other members of the group started openly speculating who the suicide bomber might be, several of them suggesting that the most likely suspect was me. As you can imagine the afternoon debriefing session was lively!

It is not easy to try to interpret and understand the conscious and unconscious dynamics of this vignette. One explanation for Susan’s behavior is that her conscious need to escape from the group led to her unconscious offering herself as a martyr for the group’s cause. Afterall, if someone has to die, why not her? She is the “old crone” who sees herself and is seen as “worthless” to a world of executive MBAs. In fact she is so “worthless’ that no-one noticed, cared, or commented on her action. No-one said: “Susan what are doing?” Or “What do you mean?” Susan had already become invisible to the group. She martyred herself; her unconscious death-wish in response to the group’s unconscious desire to kill her off. So who was the suicide bomber?

This fascinating example of group behavior leads me to the next critical topic of “what should be taught” in the ethics education curricula. This topic includes the importance of understanding the coercive pressure of groups and the ways in which group dynamics serve to diminish the moral agency of the individual.

Understanding Group Dynamics

The requirement of a psychological lens on ethics and morality is further reinforced when we consider the behavior of the individual within a group. Groups, just like individuals, pursue unconscious tasks alongside conscious ones. Once the individual becomes a member of a group she becomes caught up in the anxieties inherent in the work of the organization (e.g. remaining competitive) and the characteristic institutional unconscious defenses against those anxieties. Within no time the individual succumbs to a habitual way of seeing the world from the group’s perspective and fails to question its overt or covert cultural or moral processes (Oberholzer, 1994, 8). Ethics education needs to highlight these tendencies and encourage making our more unconscious processes conscious. This is the integration process Jung emphasized.

Another consideration in understanding groups is recognizing they have a life of their own that include many paradoxical elements. In order to understand and work with the simultaneous presence of opposite and contradictory forces we need to know their sources. These include for example the tensions associated with belonging and losing one’s identity or individuality. To advance the learning process both individuals and the group or organization need explicit exposure to the sources of paradoxical behavior of groups. Here the experiential teaching approach I discuss later can prove very helpful.

The inter-play of group dynamics and our own shadow behavior plays a significant role in the ethics-morality gap, or the inner war I discussed earlier. This fact is borne out by research carried out into the corporate culture of organizations embroiled in corporate scandals such as Enron, Arthur Andersen and WorldCom. The climate in these organizations is described as one of intimidation and fear. Here anyone who dared challenge superiors or deviated from group norms would earn immediate reprimand or group alienation. Often they would simply lose their job. As a result of group pressure impinging on people’s sense of moral freedom, well-intentioned people were caught up in a collusion of silence.

All ethical and moral dilemmas occur in the context of some collective, community or group. Organizations are the formation of a group to achieve a specific purpose. The group has more than one personality and has a group “mind” and culture that weighs heavily on the individual. Case studies, exercises, games and role plays typically side-step the group issue. When students are asked to analyze the moral behavior of others or report on their own, rarely are they placed in a position to understand or experience the power of the group effect. Teaching moral reasoning without the group aspect has little relevance to reality. The coercive nature of groups diminishes individual moral agency. Let us explore this assertion further.

The Moral Power of Groups

The well-known Protestant theologian Reinhold Niebuhr stressed emphatically the impossibility of the individual acting morally in face of the pressure of the group. Niebuhr wrote in great detail about the coercive power of groups and the impact on group morality. In his book Moral Man and Immoral Society (1995), Reinhold Niebuhr claims that in professional life, personal values are mediated by other forces inside the organizational structure that may alter the role played by personal values in decision-making.

According to Niebuhr, individuals are endowed by nature with qualities of sympathy and consideration. These prompt them to a sense of justice, which education can refine to a point, and which can enable them to be objective even when involving their own interests. On the other hand, Niebuhr argues that in “every human group there is less reason to guide and check impulses, less capacity for self-transcendence, less ability to comprehend the needs of others, and more unrestrained egoism than the individuals who compose the group reveal in their personal relations” (Niebuhr 1995, xi-xii). He explains that the inferior morality of groups as opposed to individuals arises due to the collective egoism of the group. He refers to humans’ collective behavior that can never be brought under the dominion of reason and conscience, and the dominating force of collective power that invariably exploits the weak. According to Niebuhr, relations between groups are always predominantly political rather than ethical, and will be determined by the proportion of power that each group possesses. All social cooperation on a larger scale than small intimate social groups requires a measure of coercion resulting in the dominant group being able to impose its will (Niebuhr 1995, xxiii).

Niebuhr’s argument regarding the behavior of groups seems compelling when reviewing the moral performance of economic institutions. In our day, economic rather than political and military power has become the significant coercive force of modern society. While as individuals, people may believe they ought to have harmonious relations and establish justice with one another, as groups they are intent on taking for themselves whatever power they can command. The pressure of society on individuals drives their morals rather than individuals’ own moral barometers.

Increasing the size of the group increases the difficulties of achieving a group self-consciousness. The larger the group, Niebuhr claims, the less inclined to ethical behavior and the more people are held sway to the coercive pressures within the group. According to him, “Conflict, a seemingly unavoidable prerequisite for group solidarity, and the preoccupation of gaining or surrendering power turns a group of moral individuals into an unruly mob”(Niebuhr 1995, 48).

Examination into the causes of the extent of corruption in the corporate sector appears to provide support for Niebuhr’s view: The larger the bureaucracy – Enron, WorldCom, Tyco, Walmart – the more pervasive the immorality.

The results of my recent research project into the ethical challenges facing women executives, also confirms Niebuhr’s position. The finding s of this study show overwhelmingly how executives’ moral behavior is radically influenced by the power dynamics within groups. Many executives silence themselves and pick their moral battles based on whether they feel their path of action will add or detract from their power.8 We do not need to visit the boardrooms of corporate America to see how groups influence the individual. We can see peer pressure and power dynamics alive and well in our classrooms.9

Carl Jung also had something to say about the moral power of groups. He argued that10

Every man is, in a certain sense, unconsciously a worse man when he is in society than when acting alone….Any large company of wholly admirable persons has the morality and intelligence of an unwieldy, stupid, and violent animal. The bigger the organization, the more unavoidable is its immorality and blind stupidity….Society, by automatically stressing all the collective qualities in its individual representatives, puts a premium on mediocrity, on everything that settles down to vegetate in an easy, irresponsible way. Individuality will inevitably be driven to the wall (Jung 1959, 240).

The idea that groups diminish the moral agency of individuals is an alarming one. Does this mean that nations are less moral than small groups of individuals or individuals themselves? Depending on our perspective of history we may agree with Niebuhr and Jung. My own experience and those of my clients and students support both Niebuhr and Jung’s assertions regarding the coercive nature of groups and the resultant moral failings of the group.

The pressure to conform in business organizations is enormous. As Howard Schwartz writes in Narcissistic Process and Corporate Decay (1990), the organization’s processes appear to define moral value for its employees and the organization seems to exist in a moral world of its own (Schwartz 1990, 3). My own research supports this view. Many with whom I have spoken or interviewed say “I try not to rock the boat,” or, “you’ve got to play by the rules,” or, “you cannot fight the system.” Senior executives, although less inclined to acknowledge the extent to which they conform to the expectation of their peers or their superiors will readily admit they will only challenge the system if they have a chance of winning. Being ethical, therefore, becomes subordinated to “winning” – whatever that may mean.

If we consider the corporate scandals and the behaviors of some of the executives, we cannot but agree that group pressure to conform effectively silences many. How else would executives have gotten away with their shenanigans for years and years? Can one fool all of the people all of the time? I don’t think so! So why did people not speak up? When people fail to challenge the system or fear whistle blowing they have good reason – group pressure is intense and the price is very, very high.

The Paradoxes of Group Life

Organizations are communities that at one level represent a large group and at other levels represent an aggregation of smaller groups. Every person in the group carries with her certain group identity memberships, for example race, gender, age, that are not volitional, as well as certain memberships that involve some choice, e.g. profession or function. Interaction among members consists of intra-group or inter-group conversations. These conversations can either positively assist in the achievement of the mission or goal of the organization or can, as more often than not, lead to “stuckness,” “group paralysis,” infighting or other divisive behaviors.

In this article I only raise some of the complicated dynamics that occur in groups that affect the moral behavior of its members. Besides the coercive pressure that arises from the struggle for power mentioned earlier, the paradoxical nature of group life provides sources for all kinds of conflict. Some of these sources include the need to unify the talents of different people in order to achieve a specific outcome; the ambivalence of individuals to be “part” of the group yet “apart”; the desire to be separate and connected; the tensions between disclosure, trust and intimacy; the confusions between authority and appropriate dependency; and of course the fear of and desire for power.

The paradoxes inherent in group life place all kinds of burdens on the individual. Ethics education should include discussions on how the paradoxes and sources of conflict impact both the group and individuals’ behavior. Ethics education should also provide individuals with the actual experience of their reactions to group behavior especially from a moral perspective. An obvious example is the paradox around the desire to be connected, yet not lose one’s individuality and moral autonomy to the group. This inner conflict is clearly the whistleblower’s dilemma. Once you whistleblow you become the outsider and therefore lose connection. If you do not whistleblow you remain an insider but at the price of losing your moral autonomy. It is not surprising that so few people whistleblow. The desire to remain connected is so strong. Many people choose remaining connected over leading an integrated personal life. Ethics education should help people find their threshold on this important issue.

Regression as Part of Group Life

Some people appear to intellectually regress when in a group situation. This means they revert to a less mature pattern of feeling or behavior reminiscent of earlier stages of mental life. For some simply the experience of being part of a group triggers emotions that evoke more primitive responses. Several explanations are offered for this phenomenon. Group situations evoke feelings of anxiety, loss of control, or a sense of overwhelm.

Wilfred R. Bion, a psychologist and one of the founding members of the Tavistock Institute, studied group behavior for well over thirty years. He argued that regression in groups is significant and associated with the earliest phases of mental life. He explains that, “The belief that the group exists, as distinct from an aggregate of individuals, is an essential part of this regression, as are also the characteristics with which the supposed group is endowed by the individual.” (Bion 1961, 142). The regression the individual experiences stems from a loss of her individual distinctiveness that is lost in the fantasy of the existence of an entity over and beyond its individual members (Ibid.). A consequence of this regression is that the power that individuals impute to a group then serves to overwhelm them (Smith 1987, 127). Another dynamic of regression is that some people create all kinds of fantasies about what the group can do for them and by doing so diminish their own sense of potency and agency (128).

Freud, Bion and many others have written and hypothesized a great deal about the positive and negative aspects of regression. I do not plan to delve into the details here. I raise the issue of regression purely to mark it as yet another factor in group life that influences individual and group morality. Why? Because when we regress to less mature levels of emotional response it is no surprise that our moral behavior falls short of our ethical ideal. (That inner war again!) Ethics education should in some way address this phenomenon so as to raise awareness of its existence.

Splitting, Projection and Scapegoating

I referred to the phenomenon of splitting in my earlier discussion of the shadow. Splitting occurs when we disown some undesired parts of ourselves; maybe that part we know has evil tendencies. In order to maintain a sense of psychological equilibrium, we project that disowned part of ourselves onto something outside of ourselves, typically another person or group. In this way someone else takes on the characteristics of the self that the self unconsciously wants to dispose of or disown. Many of the dynamics operative in groups and organizations may be understood in terms of splitting and projection. One of the key consequences of splitting in groups is that certain individuals or subgroups can end up carrying the “baggage” for others. The projection of the shadow at both the individual and the group level becomes the alien out there instead of the group member’s own inner problem. The “alien” out there unsurprisingly is made into the scapegoat who is then persecuted, banished or eliminated in the futile attempt to eradicate those disowned parts. Until each individual deals with her “baggage” or disowned evil she will be destined to create new aliens indefinitely.

Another aspect of the splitting-projection dynamic is role specialization in group life. Role specialization occurs when a person takes on the projected material from several or all group members. We can all think of people we know who appear to always play the same role in a group situation. There is the pacifier, the emotional one, the devil’s advocate, the clown, the challenger, the cheerleader, the idealist, and the pragmatist, to name a few. As individuals, we typically take on the role that suits our disposition. The power of roles in a group is that when a person playing a role acts, it is as though everyone has acted, because the part each member has projected onto that person has been given expression (Smith 1987, 71). Ethics education should assist students in experiencing the roles they typically take on and how this can lead to a loss of moral autonomy.

(Reprinted with permission of author.)

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For more information about Professor Beerel, please see the brief biography of her at the URL

HCS readers are invited to view other articles about SNHU or business ethics at our extensive, permanent archives under the Business Ethics section at the URL or the Christos and Mary Papoutsy Distinguished Chair in Business Ethics at Southern New Hampshire University at

The purpose of the distinguished chair in ethics is to promote and enhance students’ and community members’ awareness of ethics in personal and professional settings through teaching, community lectures and conferences. These events will foster understanding and assist in the application of lessons taught by current and classical ethicists to 21st-century settings.The chair serves as the cornerstone for an integrated university program in business ethics that encompasses the undergraduate and graduate levels. For more information about these events or about the ethics chair, contact Jane Yerrington at SNHU (603-668-2211 x2488) or visit the webpages of the ethics chair at

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