Power Corrupts, But How?

This past summer Professor Donald Palmer presented his research on organizational wrongdoing in a talk titled “Power Corrupts, But How?: An Analysis of Enron’s Illegal Special Purpose Entities” at Cornell University’s Johnson School and at Northwestern University’s Kellogg School of Management.

Using Enron as a case study, Palmer argued that corporate malfeasance occurs within a specific organizational context where wrongdoers are enabled to build both formal and informal power relations that allow them to obtain cooperation and overcome resistance from other organizational participants. Palmer concludes that solving ethical failures in organizations involves more than firing the offender.

Ethical breaches should be understood as part of a social context where certain behavior that has the potential to become unethical is initially acceptable. He advises that manager and executives need to understand the corporate context in which bad behavior develops and be willing take steps that overhaul the culture that promotes the unethical behavior before it occurs.

ASQ’s Resurgence of Relevance

Palmer, a former editor of the Administrative Science Quarterly (ASQ), a top-tier journal on the cutting edge of organizational studies since the field emerged, presented a talk on the evolution of the journal at the annual meeting of Macro Organizational Behavior Society in October. He described how the character of articles appearing in ASQ has changed since in inception in 1956, moving from more practical implications to a more theoretical orientation during the 1970s, 1980s and 1990s. Palmer says the evidence indicates that the field has come full circle in the last two decades, becoming more sensitive to practical concerns.

New Institutionalism: A Paradigm Shift in Organizational Studies

Palmer also teamed up with Dean Nicole Woolsey Biggart and Brian Dick, a graduate student in the Department of Sociology at UC Davis, to co-author “Is the New Institutionalism a Theory?” published in the Sage Handbook of Organizational Institutionalism in April. The authors examine how new institutionalism, which focuses on the larger social structures in which organizations are situated, has evolved since its development in the 1970s.

They conclude that new institutionalism has become “part of the organization theory community alongside resource dependency, population ecology, the resource-view of strategy, and other stalwart conceptualizations that help us to understand the dynamics of a world organized into firms, NGOs, agencies and industries . . . (and) arguably now the dominant paradigm in organizational studies.”