Impact of forced ranking evaluation of performance on ethical choices: a study of proximal and distal mediators

Abstract

This paper examines the impact of forced ranking method of performance evaluation on the ethical choices of managers. Evaluation using forced ranking method may cause work pressure and intra–organisational competition, which function as proximal mediators and increase the propensity for moral disengagement. Disengagement, taking on the role of a distal mediator, in turn influences ethical choices. 83 junior and middle level managers, who were randomly assigned to four treatment groups, completed a survey in which they were presented with an assigned vignette followed by a questionnaire that sought to assess their ethical intentions and willingness to report peer infractions. General linear model was used to test proximal and distal mediation. Performance evaluation using forced ranking method influenced ethical intentions but did not impact willingness to report peer infractions. Both relationships were mediated proximally through intra–organisational competition and distally through moral disengagement. By decomposing influences on ethical choices into proximal and distal causes this study demonstrates the intermediate steps through which performance evaluation using forced ranking method affected ethical choices.