There's No Such Thing As A Non-Toxic Culture

In brief

Every company has behavior that goes against what it says it is. The difference is whether it’s managed or unmanaged.
You can tell which one you have by what happens when the behavior comes from someone powerful.
Leadership defines the culture. HR builds the system that keeps it honest. Without the first, the second has nothing to work with.

Most CEOs I talk to have one.

A senior leader who brings in the revenue, or who everyone likes, or who has been there long enough to seem permanent. And that person behaves in ways that go against what the company says it is. They talk down to people. They play favorites. They bend the rules other people are held to. Everyone knows. Nobody says much.

The company is doing well, so it feels hard to justify doing anything. And the CEO is often the last person who wants to admit it’s happening, because the business is succeeding and this person is part of why.

The myth: good companies don’t have toxic behavior

We talk about toxic culture as if it’s a type of company. Some companies are toxic, the thinking goes, and good companies aren’t.

That’s not how it works. There is no such thing as a non-toxic culture. Every company is made of people, and people don’t always behave the way the company says it does. Toxic behavior shows up everywhere. What changes from company to company is whether it’s managed or left alone.

A managed culture notices when someone moves away from who the company says it is, and acts. An unmanaged culture notices too. It just doesn’t act.

How to tell which one you have

You find out when the behavior comes from someone with power. Ask yourself two questions.

Does the concern reach the people who can act on it? When someone raises a concern about a senior or high-performing person, where does it go? In a managed culture, it reaches people with the authority to do something. In an unmanaged one, it dies three levels down, because everyone already knows nothing will happen. That’s usually how a culture starts to slip. Here are seven signs to watch for.

When it reaches them, do they act? Or does the person’s title, tenure or revenue buy them a pass? Managed cultures have a ceiling on what power can protect. Unmanaged cultures don’t.

If you’re honest and the answer to either question is “probably not,” you’re not alone. Most companies would have protected that person. Quietly moved them. Renamed the problem. We’ve all watched a company “restructure” its way around someone it was too afraid to address.

What managing it actually looks like

Managing toxic behavior doesn’t mean firing everyone who slips. People aren’t perfect, and a culture that can’t tolerate a mistake has its own problems.

It means responding in proportion. How senior the person is, how much impact the role has and how serious the behavior is all matter. For someone earlier in their career, coaching or a performance plan may be the right answer. For a senior leader, there’s less runway, because a senior leader sets the standard for everyone below them. When they behave against it, the whole company learns what the standard really is.

That’s also why the cost is so high. When people watch a powerful person get a pass, they don’t just lose trust in that person. They lose trust in everything the company says about itself. Often they leave and call it a better offer.

The truth: you can’t manage a culture you never defined

Here’s the part that gets misunderstood. HR doesn’t define your culture. Leadership does. HR’s job is to manage it, systematically, not just when something blows up.

But HR can’t manage a culture nobody ever defined. You can only hold someone accountable to a standard that exists. If the company has never said who it is and what behavior that requires, then “he’s difficult” is an opinion, and opinions lose to revenue every time.

Once the culture is defined, HR can build a real system around it. One that screens the wrong behavior out at the interview, coaches people who are close, and acts when someone moves too far from the standard, no matter how senior they are. The best system doesn’t just handle the problem cleanly. It catches it early, sometimes before the person is ever hired, because you hired for the culture you named. And it keeps you from promoting the behavior in the first place, which is how so many companies end up with their best performer as their worst leader.

If you’re not sure your company could address its most powerful person’s behavior, that’s the diagnosis. The answer starts with naming who your company is, so there’s a standard to hold everyone to.

Start here