Do Toxic Cultures Drive Performance?

Welcome to this week’s blog that considers the working world,

what we do, and what it takes to work with purpose, lead with impact, and engage with people in a way that really makes a difference. In our ‘Work Unplugged’ podcast last week, Amrit drew on a conversation he had had earlier in the week, with an Australian news Organisation (Ticker News), where he was asked whether toxic organisations lead to successful organisations. Now, knowing who we are, and what we do, there is only really one answer to that question, and here I break it down for you!

Amrit gave the example of Amazon. Amazon is famously successful. Jeff Bezos is the second richest man in the world off the back of its success. In 2024 Dana Mattioli, a reporter for The Wall Street Journal wrote ‘The Everything War’, exposing how, far from the benevolent nature we were perhaps at first led to believe, Amazon operated in ways to ensure that they stayed on top, bulldozing all that stood in its way.

‘Vanity Fair’ cited this expose, talking about the culture, describing it as a ‘pressure cooker’. Where people are pitched against each other, having to apply and reapply for their own jobs, where data was used to the nth degree, and analysed, creating a ridiculous amount of pressure, and competition between people. So, what did Amazon do to combat this? They ‘compensated’ people. Compensated. Not paid people but ‘compensated’ them. A word that basically suggests we are putting you through hell, but you are ‘compensated’ for it. As Amrit said, they pay highly because they are aware of what they are putting their people through.

In today's competitive landscape, many organisations chase performance metrics with unrelenting focus. The question we need to ask is rarely “are we delivering?” but increasingly, “at what cost?” The sharp spotlight on outcomes can mask deeper issues, when wins are delivered by means that are quietly corrosive, the effects on people and long-term results are immense. It is that question, “at what cost”, that determines if an organisation is successful. What is the use of having banging results, if employees are burnt out, and everyone knows that all that is valued is performance? Eventually the reputation will be such, to ever be able to rightfully call the business ‘successful’.

Quite simply, a toxic workplace is one where harm is sustained, whether mental, physical, or emotional. High pressure may yield short-term success, but breeds burnout, disengagement, and costly turnover. When toxic behaviours are normalised, unchecked, or even rewarded, organisations start losing their edge. Talented employees leave. Productivity stalls. Reputation suffers. We need to really understand the difference between ‘stretch culture’ which challenges teams with purposeful energy, and toxicity, which drives performance through fear, exclusion, or relentless demands. The very fuel of your growth engine (the culture) determines whether performance is sustainable or sacrificial.

We would be highly recommending looking out for signs such as consistent tolerance of unacceptable behaviour (bullying, exclusion, unethical actions), rewarding results regardless of how they’re achieved, high turnover among key talent, especially those voting with their feet, burnout showing up in absence rates and engagement scores, or teams playing safe instead of innovating, or going quiet out of fear. These things really shouldn’t be ignored because they are symptoms of a far deeper issue.

None of these issues are surface level. They signal deep-seated problems that can’t be fixed with compensation, perks, or sporadic well-being initiatives. We must have our eyes open for patterns, not just isolated incidents, and regularly ‘audit’ the culture through honest feedback channels, and exit interviews.

Recent strong, and well documented evidence shows toxic culture is now the leading driver of employee turnover, far exceeding burnout or low pay. The remedy isn’t simple but begins with data. Frequent, aggregated feedback that identifies pockets of toxicity, and ties accountability for action to individual leaders or departments. Transparency, consistency, and clear repercussions for bad behaviour are essential. Policy alone isn’t enough; it’s lived through visible board and executive action. Employees must experience justice, not just promises.

Strong cultures are ultimately multipliers. When values, leadership behaviours, and daily realities are aligned, teams innovate, engage, and perform at their best. But the reverse is equally true: toxic environments can erode even the most robust business models.

Those Organisations that centre culture alongside strategy and financials, build the resilience necessary for long-term success. The question isn’t whether culture drives performance, it’s what kind of culture you’re truly fostering, and whether you have the courage to confront hard truths. The culture is there regardless, and it is either fuelling growth and longevity, or it is getting results on the way to burning people out.

Culture by design is powerful. Values that guide behaviours and provide a strong foundation are powerful. People behind a purpose with real clarity, powerful. We often talk about considering culture as a matter of strategy. We can actually design it on purpose, using data, values, and an infrastructure that supports what we want people to see, hear, and feel. And then people start to trust, and when they trust, great things happen.

Let’s not let today’s results blind your oversight of tomorrow’s risks. Culture is a strategic asset, or a liability. Leadership determines which.

If you'd like to listen to this podcast, click here!