Office (Mis)Conduct

It seemed as though everyone was happy to be back in the office. Every morning when he arrived, the CEO even noticed the same group of employees deep in conversation around a picnic table. “They must be having a brainstorming session,” he thought, and he was right. Except the employees weren’t discussing a client or project. They were plotting to defraud the company.

It’s not as far-fetched a scenario as it sounds. Even as leaders invest massive amounts of money into surveillance technology to monitor remote workers, the reality is that the office isn’t immune to bad behavior. A new study finds that stock traders who worked from home were less likely to commit securities fraud. According to the study, misconduct reports among traders fell 15% in the aftermath of the move to remote work, with the authors attributing the decline to a lack of peer pressure from office colleagues. “Rarely are financial crimes masterminded by one person,” says Deepali Vyas, global head of the FinTech, Payments, and Crypto practice at Korn Ferry. “There are usually a lot of parties involved.”

Experts say that many leaders who are calling for employees to return to the office full-time are thinking only about the positives. As Vyas notes, “There is just as much opportunity for bad behavior as good behavior in the office.” When a coworker they see every day is engaged in illegal activity, people may be less inclined to blow the whistle. They may be more easily bullied into silence or marginalized.

But bad behavior isn’t just limited to financial fraud. Everything from harassment to not working at all is just as likely to happen in the office as it is remotely, if not more so. The study on traders found, for example, that those who worked from home exhibited a lower risk of committing securities fraud than their peers even before they went remote. Leaders may want employees back in order to keep a closer eye on them, but the data suggests that there is actually a higher risk of misconduct in the office.

Alina Polonskaia, global leader of the Diversity, Equity, and Inclusion Consulting practice at Korn Ferry, theorizes that remote and hybrid work could actually make employees more conscientious. She cites as evidence a study in which researchers used toys to evaluate people’s moral decision-making. The study found that people who were given toys made more ethical decisions than those who weren’t. Drawing an analogy to the study, Polonskaia says people working from home “could feel more grounded in who they are and the decisions they make than those in a toxic office environment.” Parents working from home with kids, for instance, aren’t likely to engage in major financial fraud.

From that perspective, forcing people to return to the office could create the impression among employees that leaders don’t care about them— so why should they care about the company? Meanwhile, hybrid or remote work could, somewhat ironically, create more of a sense of belonging and affinity. “The more a company cares about its people, the more people care about it,” says Vyas. “Creating more alignment between company and employee could deter or slow down bad behavior.”

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