What happens when workplace decisions are shaped less by merit and more by personal relationships? Can fairness and merit truly survive in such environments? And when employees observe this type of influence, do they begin to redefine what is acceptable? Professors Na Fu and Ulrich Leicht-Deobald from Trinity Business School, Trinity College Dublin, together with Assistant Professor  Zhu Yao from Hunan University, explore the evolution and effects of personal relationships in a workplace.

Guanxi HRM: When relationships shape ethics at work by CoBS Editor Mallika Rahane. Related research: Yao, Z., Fu, N. & Leicht-Deobald, U. The Dark Side of Guanxi HRM Practices: Moral Disengagement and Unethical Pro-supervisor Behavior. J Bus Ethics (2026). https://doi.org/10.1007/s10551-026-06245-4

In a recently published research paper The Dark Side of Guanxi HRM Practices: Moral Disengagement and Unethical Pro‑supervisor Behaviour, Fu, Leicht-Deobald and Yao examine the question that often shadows the surface of organisational life: how relationship-driven HR practices influence employee behaviour.

Focusing on guanxi – the leverage of personal relationships in workplace decisions – they show how such practices can lead employees to engage in actions that benefit their supervisors, even when these actions cross ethical boundaries. What makes this research particularly compelling is not just the outcome, but the process through which this shift quietly unfolds.

When relationships enter formal systems

At first glance, relationships at work do not seem problematic. In many cases, they help build trust, ease communication and create a sense of belonging. However, when these relationships begin to shape formal decisions – such as promotions, rewards or hiring – the situation becomes more complex.

This is where Guanxi Human Resource Management (HRM) practices begin to materialise. Instead of decisions being guided by merit or performance, personal connections start to play a decisive role.

More importantly, something less visible begins to shift. Employees start interpreting what these patterns mean: Organisations may speak the language of fairness and merit, yet everyday decisions can suggest something different.

Over time, employees realise that opportunities appear uneven. Effort does not always translate into outcomes. In this way, employees are not simply following rules and policies. They are reading signals.

How employees interpret what they see

To understand this process, the authors draw on the theory of social information processing – the idea that individuals rely on social context to make sense of acceptable behaviour. Rather than relying only on formal policies, employees observe what actually happens around them.

When HR decisions consistently reflect personal relationships – i.e. when guanxi HRM practices exist – an implicit signalling begins to emerge. It suggests that loyalty to a supervisor may matter more than formal performance. This message does not need to be stated outright. Rather, it is seen. Repeated. And gradually understood.

Employees begin to adapt. Aligning with a supervisor, protecting their interests, or going out of one’s way to support them starts to feel less unusual, even if these behaviours might not be fully ethical. The researchers call this pro-supervisor unethical behaviour. And in some cases, it begins to feel not just less unusual, but also necessary.

When right and wrong become adaptable

What makes this shift particularly powerful is not just behaviour, but how employees justify it. The research highlights a key concept here: moral disengagement – the underlying cognitive and psychological mechanism through which individuals rationalise actions that would normally feel unethical. The lines between right and wrong become blurred. Negotiable. Flexible.

When employees see that decisions are already influenced by relationships, they begin to reinterpret their own actions. Ethical compromises become easier to justify. Helping a supervisor, even in questionable ways, can start to feel acceptable, even expected.

The justification is rarely dramatic. It often takes simpler, quieter forms: “Everyone does this. This is how things work here. I don’t really have a choice.”

Over time, these small shifts accumulate. What once seemed clearly wrong begins to feel less questionable. The boundary does not disappear – it simply moves.

The role of close supervisor relationships

Interestingly, this effect does not occur in the same way for everyone. The research highlights that guanxi HRM practices are more likely to trigger unethical behaviour when supervisor subordinate guanxi is high.

These relationships create both proximity and influence. Employees with stronger ties are more exposed to how decisions are made. At the same time, they have more to gain – and potentially more to lose. As a result, the signals they receive feel more personal and more relevant.

In such situations, supporting a supervisor can take on greater importance. The motivation to maintain the relationship, combined with the perceived benefits, makes it easier to justify behaviour that might otherwise feel questionable.

What begins as loyalty can, over time, blur into something more ethically ambiguous.

Guanxi beyond cultures

Although the concept of guanxi is rooted in Chinese organisational settings, the broader idea extends far beyond it. Practices such as nepotism or favouritism exist across many cultures, along with documented studies. The form may differ, but the underlying dynamic remains similar: relationships influencing decisions that are meant to be impartial.

This makes the findings particularly relevant. They are not only about one system, but about a broader organisational reality – one where informal relationships quietly interact and interfere with formal structures.

Closing the gap through HRM consistency and ethical alignment

The research encourages organisations to look more closely at the gap between what is formally stated and what is informally practised. When fairness and relationships begin to overlap, the effects unfold gradually, through perception, interpretation and justification. Hence, it is important to investigate this gap before employees begin to draw their own conclusions about what is valued.

For managers, it becomes important to ensure that HR practices remain transparent and consistently aligned with merit. At the same time, attention needs to be given to ethics awareness and how employees interpret everyday decisions, as these interpretations shape behaviour over time.

A more thoughtful approach would involve not only reducing reliance on informal influence, but also reinforcing clear ethical standards in practice. In doing so, organisations can move towards a context where actions, rather than signals, define what is acceptable.

Useful links:

• Link up with Profs. Na Fu and Ulrich Leicht-Deobald on LinkedIn
• Read a related article: People Management: From Dilemma to Paradoxical Solution
• Discover Trinity Business School, Trinity College Dublin
• Apply for an MBA at Trinity Business School
• Are you a Trinity alumni living or working in Singapore? Join the CoBS Global Alumni Meet Up hosted at ESSEC Asia-Pacific on June 10th, 2026. Register here.

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