Question

Research shows that fraud occurs less frequently when employees feel:

1) Ownership in the organization
2) Threatened
3) Abused by management
4) Challenged with unreasonable performance goals

Answer 1

Fraud is less likely to occur when employees have a sense of ownership within an organization, as supported by research and theories like Theory X and Theory Y that highlight the importance of treating employees with fairness and giving them responsibility.

Step-by-step explanation:

Research indicates that fraud occurs less frequently when employees feel ownership in the organization. In an experiment by Greenberg (1993), the way information was communicated to subjects about their pay affected their likelihood of stealing. This embodies the concept of procedural justice, which emphasizes the fairness of the processes by which outcomes are determined. Moreover, theories such as Theory X and Theory Y suggest that people are inherently more satisfied and motivated when they are given responsibility and treated with fairness, which aligns with the notion of ownership.

Ownership in the organization inspires employees to align their personal goals with those of the company, and as a result, they are less likely to commit fraud. On the contrary, when employees are threatened, abused, or set unrealistic performance goals, they feel undervalued and stressed, leading to a potential increase in fraudulent activities. Therefore, fostering a workplace where employees feel a sense of ownership and are motivated by rewards rather than being subjected to punishment is crucial for reducing fraud and other negative behaviors.