Why Reforming Meritocracy Requires More Than Adding Character to the Equation

Thomas Cole's recent MIT Sloan Management Review article proposes a compelling solution to the meritocracy crisis: expand merit definitions to include character alongside capabilities and performance. As chair emeritus of global law firm Sidley Austin and author of a book on meritocracy, Cole brings significant credibility to this discussion. Yet his prescription, while well-intentioned, reveals the deeper complexities that make meritocracy reform so challenging and raises questions about whether character assessment solves the problem or simply relocates it.

The fundamental premise deserves examination. Cole acknowledges that meritocracy has been called a myth, sham, trap, and tyranny, yet argues it remains worth salvaging. This optimism stands in tension with mounting evidence that meritocracy may be structurally incapable of delivering its promises, regardless of how we define merit. Before accepting that character assessment can rescue meritocracy, we must grapple with why the system fails so consistently and whether those failures are features rather than bugs.

The Measurement Problem Nobody Wants to Discuss

Cole correctly identifies that decision makers lack awareness of their own biases when assessing merit. However, he understates how dramatically this problem intensifies when evaluating character rather than technical skills. While assessing someone's Python coding ability or financial modeling skills involves relatively objective criteria, evaluating integrity, humility, or empathy introduces layers of subjectivity that make bias not just likely but inevitable.

Research from organizational psychologists reveals the challenge. A 2023 study published in the Journal of Applied Psychology found that managers' character assessments of employees correlated more strongly with similarity to the manager than with objective behavioral measures. When evaluators judged traits like integrity and humility, they essentially asked: Does this person demonstrate these qualities in ways I recognize and value? This question inherently privileges those who share the evaluator's cultural background, communication style, and worldview.

Consider how different cultural contexts interpret character traits. What reads as appropriate humility in Japanese business culture might appear as lack of confidence in American contexts. Direct communication valued as integrity in Dutch culture could be perceived as rudeness in other settings. Collectivist cultures might interpret behavior as demonstrating empathy and team orientation, while individualist cultures view the same actions as lacking initiative. Who decides which cultural expression of character traits counts as merit?

The technology sector provides instructive examples. For years, companies prized leaders who displayed aggressive confidence, viewing it as evidence of vision and determination. This character assessment systematically favored certain personality types and genders while penalizing others who demonstrated equal capability through different behavioral styles. When Elizabeth Holmes at Theranos adopted the deep voice and black turtleneck associated with visionary tech leadership, she was performing to expected character markers, yet those same markers obscured rather than revealed her actual character.

The Historical Weaponization of Character Requirements

Cole's proposal cannot be evaluated without examining how character requirements have historically functioned as exclusion mechanisms. Throughout the 20th century, professional gatekeepers regularly invoked character to bar qualified candidates from opportunities. Medical schools questioned whether women possessed the emotional character for medicine. Law firms doubted whether members of certain religious or ethnic groups had the integrity for legal practice. Corporate boards questioned whether people from working-class backgrounds possessed the leadership character for executive roles.

These gatekeepers believed they were making legitimate character assessments. They weren't consciously bigoted; they genuinely could not recognize certain types of people as having leadership character because their mental models of what leadership looked like excluded those individuals by definition. The problem wasn't that they failed to assess character. The problem was that their character assessments reflected and reinforced existing hierarchies.

Michael Young, who coined the term meritocracy in his 1958 satirical novel, understood this danger. His book depicted a dystopian future where meritocratic sorting created a new hereditary class system, with the elite justifying their privilege through claims of superior merit. Young intended meritocracy as a warning, not an aspiration. He recognized that any sorting mechanism, however well-intentioned, tends to legitimize and calcify existing advantages.

Contemporary research supports Young's prescience. A 2022 study from Stanford sociologists found that children of executives were significantly more likely to be rated as having leadership character traits in assessment centers, even when controlling for actual behavioral measures. Evaluators consistently interpreted identical behaviors differently based on the candidate's background. When an executive's child displayed confidence, evaluators noted strong leadership character. When a working-class candidate showed the same confidence, evaluators sometimes perceived arrogance or insufficient respect for authority.

Beyond Individual Character to Systemic Design

Cole focuses on individual character assessment, but this framing itself may be problematic. It locates the meritocracy problem in better identifying worthy individuals rather than examining the systems that produce and recognize worthiness. This perspective obscures how organizational structures, not just individual traits, determine outcomes.

Consider two equally talented, hardworking individuals with strong character. One has access to elite education, professional networks, mentorship, and financial security that allows risk-taking. The other faces educational inequity, limited networks, no mentorship, and financial constraints that make risk-taking dangerous. When they compete for the same position, the first candidate will likely present more impressively, not due to superior character or capability but due to accumulated advantages.

Meritocracy, even reformed meritocracy, treats the starting point as irrelevant. It asks only: Who performs best now? This framing systematically advantages those who have already been advantaged and labels that advantage as merit. Adding character assessment doesn't solve this problem unless we're willing to say that growing up wealthy or attending elite schools demonstrates superior character, a claim few would explicitly defend yet many implicitly accept.

Organizations serious about fairness must look beyond individual assessment to systemic design. Netflix's approach to talent management offers one model. Rather than elaborate character assessments during hiring, Netflix emphasizes creating systems where character becomes visible through actual work. They hire based on capabilities, then create cultures where cutting corners becomes difficult and integrity becomes functionally necessary. The system shapes behavior rather than attempting to predict character.

Similarly, Bridgewater Associates' radical transparency model makes character development an ongoing organizational process rather than a selection criterion. By making all meetings recorded and most internal communications visible, the system reduces the possibility of duplicitous behavior while helping people develop self-awareness about their actual conduct versus their self-image. Character becomes something cultivated through organizational design rather than screened for in hiring.

The Double Standard Problem Runs Deeper

Cole rightly identifies double standards as undermining meritocracy's legitimacy. When organizations hold different people to different standards, it reveals the game is rigged. However, his proposed solution doesn't adequately address why double standards exist and persist.

Double standards aren't typically conscious hypocrisy. They emerge from fundamental attribution error: the tendency to attribute our own failures to circumstances while attributing others' failures to character. Leaders excuse their own corner-cutting as necessary pragmatism while viewing similar behavior from subordinates as ethical lapses. They interpret their own confidence as leadership while seeing others' confidence as arrogance. Their resilience comes from strength; others' comes from inability to recognize failure.

This cognitive bias intensifies when assessing character precisely because character traits are interpreted through behavior, and identical behaviors get interpreted differently based on who performs them. A 2021 meta-analysis in Psychological Bulletin found that leadership character assessments showed larger demographic disparities than technical skill assessments, likely because the subjectivity inherent in character evaluation provides more room for bias to operate.

Organizations can implement structured approaches to reduce this bias. Google's research on effective interviewing found that behavioral interviewing with standardized rubrics improved both prediction accuracy and demographic equity compared to unstructured character assessments. When interviewers asked identical questions and evaluated responses against predetermined criteria, bias decreased. However, even structured approaches showed persistent disparities when evaluating subjective traits like leadership character versus concrete skills.

The military's experience with character assessment offers relevant lessons. West Point has evaluated character for over two centuries, developing sophisticated assessment tools. Yet recent research published in Military Psychology found that character assessments at admission showed weak predictive validity for later ethical leadership, while structured leadership development programs showed much stronger effects. Character proved more trainable than predictable. This suggests organizations might gain more from investing in character development systems than character screening systems.

What About Performance Under Pressure

Cole argues that leaders lacking strong moral compass are more likely to cut corners during stress or crisis. This claim seems intuitively compelling but deserves scrutiny. What evidence suggests character assessments during hiring predict ethical behavior during subsequent crises?

The financial crisis of 2008 provides a natural experiment. The leaders who made catastrophic decisions that crashed the global economy weren't obvious bad actors who snuck past character screening. Many had sterling reputations, impressive credentials, and track records of seemingly ethical leadership. Their firms had values statements emphasizing integrity. Many had been assessed positively for character traits. Yet under particular pressures, in particular systems, they made choices that revealed character failures.

Were those character failures always present but hidden? Or did the systems and incentives shape behavior in ways that overwhelmed individual character? Research suggests both, but with systems playing a much larger role than we typically acknowledge. The famous Stanford Prison Experiment, despite its methodological flaws, demonstrated how quickly situations can override character. More rigorous subsequent research has confirmed that context powerfully shapes ethical behavior.

Organizations should focus less on screening for character and more on building systems that support ethical behavior under pressure. This means examining incentive structures, decision-making processes, accountability mechanisms, and cultural norms. When Wells Fargo employees created millions of fake accounts, was that a character screening failure or a systemic design failure? The aggressive sales targets, inadequate oversight, and retaliation against whistleblowers created conditions where character couldn't easily prevail.

Citigroup's response to its 2008 crisis offers an instructive contrast. Rather than blaming individual character failures, new leadership redesigned risk management systems, decision-making processes, and accountability structures. They assumed even good people make bad decisions in bad systems, so they focused on system improvement. This approach proved more effective than replacing people would have been.

Rethinking Merit Entirely

Cole's article assumes merit is a discoverable quality that exists independent of context. We need only define it properly and assess it accurately. But what if merit is socially constructed rather than objectively real? What if organizations create merit through their definitions and assessments rather than discovering pre-existing merit?

This isn't postmodern nihilism. It's recognition that merit has no meaning outside specific contexts. Someone might demonstrate exceptional merit as an individual contributor but struggle as a manager. They might show strong character in low-stakes situations but crack under pressure. They might appear humble in positions of weakness but arrogant when given power. Merit isn't a stable individual attribute but an interaction between person, role, and context.

This perspective suggests organizations should emphasize fit and development over selection and sorting. Rather than trying to identify people with superior merit, focus on matching people to roles where they can contribute effectively and creating systems that help them develop. Rather than ranking people on character, build cultures that support ethical behavior.

Patagonia's approach exemplifies this philosophy. Rather than elaborate character screening, they hire people who share their environmental values, then create systems that make ethical behavior the path of least resistance. Supply chain transparency, environmental accounting, and stakeholder governance make cutting corners difficult. Character becomes an organizational outcome rather than an individual input.

Semco Partners in Brazil offers another model. They eliminated most hierarchy and job titles, instead allowing people to self-organize around work that needs doing. This system makes certain character traits functionally necessary. Free riders become visible quickly. Integrity becomes essential for maintaining trust-based collaboration. Character develops through practice rather than screening.

Practical Steps Forward

Despite these criticisms, Cole identifies a real problem. Organizations need better approaches to hiring and promotion decisions. The question is whether character assessment, as he proposes, is the right solution or whether we need different interventions entirely.

Organizations should consider several approaches:

• First, acknowledge that perfect meritocracy is impossible. Any selection system will be imperfect, biased, and context-dependent. This acknowledgment enables more realistic evaluation of different approaches' tradeoffs rather than seeking an ideal solution.
• Second, emphasize transparency about criteria and processes. When people understand how decisions get made, they can better assess fairness even when they disagree with outcomes. Secret criteria and opaque processes breed cynicism regardless of actual fairness.
• Third, implement structured decision-making processes with clear criteria, multiple evaluators, and documented rationales. Structure doesn't eliminate bias but reduces it. Having multiple evaluators with different perspectives helps catch individual blind spots.
• Fourth, focus on behavioral evidence rather than trait inferences. Instead of asking whether someone has integrity, ask about specific situations where they faced ethical dilemmas and how they responded. Concrete behaviors are more objective than abstract character judgments.
• Fifth, invest heavily in development rather than selection. The military's approach recognizes that character develops through experience, training, and mentorship. Organizations that emphasize development often outperform those that emphasize selection.
• Sixth, regularly audit outcomes for demographic disparities. When certain groups consistently fare worse in evaluations, that pattern suggests bias in the process regardless of intentions. Outcomes provide accountability that intentions cannot.
• Seventh, create systems where ethical behavior is functionally necessary rather than relying on individual character to resist systemic pressures. Strong ethics programs, whistleblower protections, and accountability mechanisms matter more than character screening.
• Eighth, consider whether hierarchy itself needs rethinking. Many meritocracy problems stem from winner-take-all tournaments where small perceived merit differences justify large outcome differences. Flatter structures with more distributed authority reduce the stakes of individual assessment decisions.

The Uncomfortable Truth

The hardest truth about meritocracy is that it serves important functions beyond allocating talent efficiently. It legitimizes inequality. When we believe success reflects merit, we feel comfortable with vast disparities in outcomes. The successful deserve their success; the unsuccessful deserve their failure. This legitimizing function may be meritocracy's primary purpose, with talent allocation as secondary.

If so, calls to reform meritocracy face uphill battles. Those who benefit from current arrangements have strong incentives to preserve meritocratic rhetoric while resisting changes that might threaten their advantages. Adding character assessment could make meritocracy more legitimate without making it more fair, which might be precisely what many stakeholders want.

Cole's optimism that reformed meritocracy can "restore respect for authority" reveals this tension. Respect for authority serves those in authority. It's not obviously desirable for society overall, particularly when authority hasn't been earned through genuinely fair processes. Perhaps we need less respect for authority and more skepticism, less meritocracy and more democracy, less sorting and more inclusion.

The alternative to meritocracy isn't random selection or nepotism. It's recognition that organizational success depends less on identifying superior individuals than on building systems where ordinary people can contribute effectively. It's humility about our ability to predict performance. It's skepticism about whether sorting people into winners and losers serves organizational or social purposes. It's focus on creating conditions where everyone can develop and contribute rather than screening for the already developed.

Conclusion

Thomas Cole is right that current meritocracy practices fail to deliver on their promises. He's right that double standards breed cynicism. He's right that character matters for leadership. But his solution of adding character to merit assessment likely intensifies rather than resolves meritocracy's fundamental problems.

Character assessment is inherently subjective, culturally specific, and vulnerable to bias. Historical experience shows that character requirements have regularly functioned as exclusion mechanisms. The measurement challenges are profound. The predictive validity is questionable. The risks of weaponization are high.

More fundamentally, focusing on better individual assessment distracts from more promising systemic interventions. Organizations achieve better outcomes by building systems that support ethical behavior, creating cultures where character develops, and distributing authority to reduce the stakes of individual assessment decisions.

Meritocracy, even reformed meritocracy, rests on problematic assumptions: that merit exists as a stable individual attribute, that we can measure it accurately, that unequal outcomes reflect unequal merit. These assumptions don't withstand scrutiny. They serve legitimizing functions more than descriptive accuracy.

Business leaders should pursue fairness through multiple strategies: transparent criteria and processes, structured decision-making, behavioral rather than trait assessment, heavy investment in development, regular audits for demographic disparities, systems that make ethical behavior necessary, and consideration of less hierarchical structures. Character matters, but organizational character matters more than individual character, and organizational character emerges from systems and culture rather than hiring practices.

The meritocracy we need isn't reformed meritocracy. It's recognition that organizational success depends on creating conditions where diverse people can contribute effectively, where ethical behavior is supported systematically, where development matters more than selection, and where we remain humble about our ability to judge merit accurately. That's a harder sell than reformed meritocracy because it requires those currently advantaged to question whether their advantages reflect merit or simply advantage. But it's the conversation we need to have.

For a deeper exploration of how redefining meritocracy to include character can impact organizations, read more here.