Designing Trustworthy Organizations

Companies often blame trust violations on ‘rogue employees,’ but these violations are predictable in organizations that allow dysfunctional, conflicting or incongruent activities to take root.

BY ROBERT F. HURLEY, NICOLE GILLESPIE, DONALD L. FERRIN AND GRAHAM DIETZ

In the aftermath of the well-publicized corporate scandals of Enron, WorldCom and Tyco circa 2001 and 2002, there were major efforts in the United States to restore trust and enforce corporate compliance. Among other things, the U.S. Congress passed the Sarbanes-Oxley Act of 2002, featuring enhanced whistleblower protections, holding CEOs and CFOs personally responsible for financial statements, and establishing the creation of the Public Company ...