In an age when we hold our companies, and indeed our leaders, to higher standards, the very notion of deliberately hiring an unethical boss might seem absurd. Yet, new research from the University of Maryland suggests that we might be subconsciously doing it on purpose.

The research suggests that people possessing the so-called “dark” personality traits, such as narcissism and questionable ethics, are far more likely to go along with manipulating earnings statements.

Hiring leaders

The researchers examined how organizations hire executives into the management accounting department and how this relates to the earnings management practices at those organizations.  They wanted to examine if there was a direct link between the hiring practices and the tendency to inflate the income of the firm.

Across a number of studies, the researchers found that when companies wanted to report earnings aggressively, they tended to recommend hiring candidates with the kind of dark personality traits that would encourage that to happen and test the ethical boundaries.

“Dark personality traits are often framed as an accidental byproduct of selecting managers who fit the stereotype of a strong leader,” the researchers say. “However, our research found that this is often no accident.”

Rating the candidates

Across a number of experiments, the researchers were assessing the merits of candidates across a range of dimensions, including their abilities as managers of people.  Those with dark character traits were found to only outperform their peers on their willingness to manipulate ethical boundaries.

“A lot of people assume that these managers must have great self-presentation, promotion, people skills, or confidence,” the researchers explain. “But our research shows otherwise.”

When companies feel like they need to inflate their earnings, we appear to subconsciously choose managers who will help to fulfill that aim, even when candidates with far better managerial ability in every other regard are available.

That these findings occurred even among executives and executive recruiters who have significant experience in just such hiring environments suggests a worrying trend.  The researchers hope that their findings provide an eye-opener to organizations to explore the ethics of their hiring practices.

“The best takeaway for employees is to avoid companies that might have use for managers with dark personalities, and not to expect support from higher-ups when this is the case,” they conclude. “The company might have picked a bad boss on purpose.”