Scapegoats in Suits: Bad Apples or Rotten Barrels?

"The search for a scapegoat is the easiest of all hunting expeditions." - Dwight D. Eisenhower

The Bible (and The Torah) recounts the story of "the scapegoat" as one of a pair of kid goats. One goat was sacrificed, while the “scapegoat” was cast into the desert to "carry away" the sins of the community. Friend of and guest on The Innovation Show, Luke Burgis tells us in his book, "Wanting ", that the ancient Greeks practised a version of a?scapegoating?ritual—but they sacrificed humans, not animals.

In early Greek history, during times of plague, drought or famine, when societies feared for their survival, each Greek town would elect an inhabitant on the edges of society, someone conveniently “different", a slave, an outcast or a criminal. This unfortunate person was the pharmakós. The word pharmakós is the root of the English word “pharmacy.” To the Greeks, it meant both a poison and remedy—like a vaccine, a necessary poison. In times of turmoil, the sacrifice of the pharmakós brought a temporary order to the chaos. In the business world, scapegoating remains alive and well.

The Scapegoat Mechanism in Business

Leadership (to the head of DEI): “You mean to tell us you have failed to solve racism!?! You’re Fired!"

Often, the scapegoats in modern businesses wear suits. Leaders in roles like Innovation, DEIQ, and ESG are tasked with transforming organisations. Yet, they frequently lack the resources and authority to enact meaningful change. When their initiatives falter, they become convenient targets for blame.

"Scapegoating masks the true cause of the violence and shifts blame to an innocent victim." - René Girard

René Girard, a renowned anthropologist and philosopher, identified the scapegoat mechanism as a recurring pattern in human societies. When a community faced a crisis, people collectively projected blame onto an individual or a group, regardless of their true culpability. Eliminating the scapegoat brought with it a false sense of relief and unity.

In corporations, this translates to blaming "bad apples" for organisational failures, rather than addressing the systemic issues of “a rotten barrel". While this is the case with failures in innovation, DEI, ESG and any transformation it’s also true at a cultural level. This is evident in cases like the Wells Fargo scandal and the Volkswagen Dieselgate emissions fraud. CEOs often point fingers at a few rogue employees to avoid taking responsibility for broader cultural problems.

In her book, “Higher Ground”, our guest on The Innovation Show , Alison Taylor reminds us, “Cultural conditions can persist and metastasise, even when leaders are removed.” For example, Wells Fargo burned through 4 CEOs in 8 years after its fake accounts scandal broke in 2014. Boeing had 3 in the 3 years following the grounding of the 737 MAX!

It's easy to blame individuals for unethical behaviour, while, research reveals that toxic cultures, a lack of psychological safety, and misguided incentives play a significant role.

The Volkswagen Dieselgate scandal is a prime example of a "rotten barrel." The company's autocratic leadership style and culture of fear fostered an environment where unethical decisions could thrive.

A Toxic Barrel: Volkswagen’s Dieselgate

After the Dieselgate debacle, then chairman of VW's board of management, Martin Winterkorn,?stated that these actions were “the terrible mistakes of a few people,”with whom he did not identify! Soon afterwards, he resigned in “shock” that misconduct had occurred on a grand scale. Scapegoating the bad apples conveniently absolves leaders of personal responsibility for any wrongdoings undertaken on their watch.

In 2009, Bernie Madoff told Vanity Fair: “It starts out with you taking a little bit, maybe a few hundred, a few thousand. You get comfortable with that, and before you know it, it snowballs into something big.” This echoes that famous retort uttered by a character in Ernest Hemingway’s novel "The Sun Also Rises”. When asked how he went bankrupt, he replied: “Two ways. Gradually and then suddenly.” (This summation of how business failure creeps up on victims is a line quoted in Big Bang Disruption, by a friend of The Innovation Show , Paul Nunes .)

Post-mortems of the Dieselgate scandal reveal that the company suffered a similar fate. It degraded into a rotten barrel of apples gradually, then suddenly.

Volkswagen had thrived under the autocratic leadership of Winterkorn and his mentor, Ferdinand Pi?ch. VW leadership set aggressive unrealistic goals, with senior executives involved in even minor decisions. Former employees described a workplace where subordinates feared admitting failure or contradicting superiors. Company leaders bullied employees, and Pi?ch boasted about achieving superior performance by “terrifying his engineers” and even firing those who displeased him. Winterkorn disliked bad news, with an industry analyst noting, “Before anyone reports to him, they make sure they have good news.” Winterkorn found it easy to blame a bad apple rather than address the “Dorian Gray barrel” environment he had helped create. It was a case of near-death by a thousand corner cuts and cultural demise by a thousand cracks.

Maintaining the Healthy Barrel

Transforming corporate culture, while difficult, is not impossible. It involves bringing in external leaders with fresh perspectives, implementing robust internal oversight, and establishing and enforcing consequences for unethical behaviour. Companies should have a well-defined values statement that guides organisational actions and top management must exemplify these values daily.

To address the root issues—beyond blaming "bad apples"—efforts to build an ethical culture must focus on the overall conditions within the "barrel." This means scrutinising power dynamics, resources, incentives, and norms. How these elements are structured and designed reflects how leaders perceive the company's purpose in the broader environment. How a company generates revenue and manages its impacts is as crucial as its adherence to legal standards. The key questions are: What behaviour does the organisation reward, and what does it punish? Addressing these questions helps ensure the entire barrel is healthy, not just the individual apples.

Thanks for Reading

Listen to our latest episode of The Innovation Show with Alison Taylor, where we delve deeper into ethics, ESG, and how to build a “Higher Ground" for your organisation.

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