When Unselfaware Leaders Are Rewarded: The Hidden Costs of Psychological Blindness in Leadership Success

Leadership is often celebrated for bold vision and impressive results, but when those in power lack self-awareness, the psychological consequences for individuals and organizations can be profound. Leaders who are psychologically unaware of how their behaviors affect others may still be rewarded and even promoted, as their actions are often misinterpreted as indicators of strength or success. Understanding these dynamics—and the importance of holding such leaders accountable—is crucial for personal well-being and collective progress.

Narcissistic Leadership: Unconscious Harm in the Pursuit of Success

Narcissistic leaders, whether consciously manipulative or simply unaware of their impact, often display self-absorption, a sense of superiority, and a relentless drive for achievement. Without self-awareness, these leaders may genuinely believe their actions are justified or beneficial, failing to recognize the emotional and psychological harm they inflict. As Gustavo Razzetti notes, “Narcissists create cultures that are toxic, but fail to realize the stress they create around them. Achievements feed grandiosity, creating a distorted self…” This lack of insight can make their behavior more insidious, as it is often masked by outward signs of success and organizational growth.

Research shows that such leaders frequently overestimate their own effectiveness, reject critical feedback, and implement divisive policies. Their lack of empathy and tendency to claim sole credit for achievements can leave employees feeling unsupported and alienated, even as the organization appears to thrive on the surface.

A Personal Story: Anna’s Experience

Consider Anna, a manager in a large company. Her director, widely admired for his impressive results, consistently took credit for her team’s successes and blamed her for setbacks. When Anna raised concerns about unrealistic expectations and emotional manipulation, the director dismissed her as “difficult,” unaware of the psychological harm his actions caused. Over time, Anna doubted her own abilities and became isolated, her health suffering from chronic stress. She eventually left, convinced she was the problem.

Anna’s story exemplifies how a leader’s lack of self-awareness can perpetuate a cycle of harm, even as they are celebrated for their apparent achievements. The leader’s inability to see the effects of their actions leaves employees to navigate confusion and self-doubt, eroding confidence and well-being.

The Cost of Silence and the Need for Accountability

When those affected by psychologically unaware leadership remain silent, these destructive patterns persist. Without honest feedback or the voices of those harmed, leaders remain oblivious to the consequences of their actions, and organizations fail to address the root causes of dysfunction. As research in Frontiers in Psychology highlights, narcissistic leaders’ lack of empathy and exploitative tendencies lead to a lack of autonomy and support for employees, resulting in depleted psychological resources and growing hostility toward supervisors.

This silence not only allows narcissistic behaviors to continue but also enables organizations to mistake these patterns for effective leadership, rewarding and promoting individuals who perpetuate harm. Speaking up is essential—not just for personal healing, but for developing collective intelligence about these covert dynamics and holding leaders accountable.

The Mental and Physical Health Crisis

The psychological toll of narcissistic leadership is well-documented. Employees exposed to such environments often experience emotional exhaustion, anxiety, and depression, with chronic stress leading to physical health problems. The negative impact is most pronounced among vulnerable employees, such as those with lower self-esteem, who are more likely to perceive and be affected by abusive behaviors.

Recognizing and Addressing Unconscious Narcissism

Narcissistic tendencies—whether conscious or not—can have lasting effects on organizational culture and employee well-being. As Kets de Vries warns, “Narcissists are addicted to the grandiosity of their own self-image.” Without recognition and accountability, these leaders can undermine collaboration, erode trust, and stifle creativity, all while being rewarded for their apparent success.

Toward Awareness, Accountability, and True Success

When leaders lack self-awareness and are not held responsible for their behaviors, their psychological blindness can be misinterpreted as strength or success. This creates confusion, undermines health, and perpetuates toxic cultures. Speaking up about these experiences is vital for personal and organizational growth. Only by recognizing and naming these patterns can we hold leaders accountable, foster psychological safety, and build healthier, more resilient workplaces.

“Narcissists create cultures that are toxic, but fail to realize the stress they create around them. Achievements feed grandiosity, creating a distorted self…”— Gustavo Razzetti

By bringing these covert patterns to light, we not only protect ourselves but also contribute to a deeper collective understanding—essential for breaking cycles of abuse and fostering environments where everyone can thrive