How to Recognise Toxic Corporate Culture

As a manager, how do you recognize when the culture within a team or organization is toxic? There are red flags to look out for when there is a toxic culture within a company, and there are also ways to prevent these from happening, or from turning things around if they have already become toxic.

Communication Issues

One sign indicating a toxic company culture is communication. This can apply to communication within teams as well as across the organization. Having poor communication or lack of any communication at all, is detrimental to getting anything done. If teams cannot communicate with each other, whether because of personal issues with each other or laziness, it becomes impossible to effectively get the job done. If there are major changes happening within the company that are affecting the employees, and they are the last to know about this, it may cause distrust.

Poor Leadership

Poor leadership can be another issue causing a toxic company culture. Employees look to leadership to define the rules and then play by them. If leaders are setting a poor example, what should be expected of employees? Just as important as the way the leaders and managers carry about their business, is how they deal with their employees. If they set unachievable standards or have a reputation of mistreating their employees, morale plummets and you are left with unhappy employees.

Personal Health Issues

For employees experiencing stress or unhappiness within the workplace, mental and physical health issues could soon follow. Stress causes weight gain, heart problems, and burnout in the workplace. Employers will pay for those sick days or leave of absences and the day-to-day work from employees will suffer.

Immoral or Illegal Activities
When there is a lack of a code of conduct or a disregard for the current one, it leaves the opportunity for immoral or illegal activities. This links back to poor leadership as this kind of behaviour usually comes from the top down. Recently news surfaced that Wells Fargo employees had committed several immoral and illegal activities by opening up new unauthorized accounts for members without their consent in order to fulfil a quota set in place by managers. The toxic work culture in Wells Fargo was seen through employees who feared for their job security if they did not meet this unreasonable quota set by leadership. Additionally, if the managers or leaders knew and did nothing about it, they are essentially encouraging and rewarding this behaviour.


There are consequences of having a toxic corporate culture in that it greatly affects the success of the company. If you have unhappy employees, they are likely to look for employment elsewhere, resulting inthe company losing talent and putting manpower behind finding replacements. In addition, the work from employees who stay may suffer. They no longer feel a loyalty to a company that does not take care of employeesand the work they do turn in will not be up to par. Lastly, if employees suffer physical and mental health issues due to the toxic culture, they may need more sick days or may not be able to output top performances as often as they used to, or as often as is needed.

Luckily, there are ways to turn this toxic culture around! Start with leadership — whether that means changing behaviours of current leaders or replacing them. If leaders in an organization take a strong stance against illegal and immoral happenings and encourage a good culture, a trickle down effect occurs. Employees start seeing the expectations and behaviour of the managers and leaders and follow suit. Following that, you should see an increase in morale and excitement within the company from employees. This in turn shows in the work produced by these employees. It is time consuming and difficult to change the behaviours of people, most do not take to change well, but it is crucial to taking the toxicity out of your company culture.

Ashley Herbert

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