For many,  the term "loyalty" immediately brings to mind instances when tight allegiances have led to scandals and cover-ups.

There's certainly no shortage of such cases in the business world, from the recent  Volkswagen debacle, stretching back to the implosion of Enron, and beyond. Of course loyalty can be used for both virtuous and and nefarious ends, however. Francesca Gino, a professor at Harvard Business School, writes in Harvard Business Review about the impact that loyalty has on ethical (and unethical) behavior.

Gino and her colleagues have found that the concern that loyalty always drives unethical behavior is unfounded. "In fact, we found loyalty to a group can increase, rather than decrease, honest behavior," she writes.

In multiple studies in which subjects took tests or solved puzzles with performance-based prizes, the researchers found that people were more honest when prompted to be loyal to their group before completing the task.

For example, in one experiment, 20 percent of participants who took a loyalty pledge cheated when scoring their own performance on a set of math puzzles, compared with 44 percent of those who did not take the pledge.

"As our research shows, loyalty highlights the importance of ethical principles, bringing people's attention to the fact that behaving ethically is the right course of action," she says.

On the other hand, the researchers found, competition among groups can be a force that causes immoral behavior. In another experiment that featured cash prizes for solving puzzles, fraternity members who were prompted with a note from their house president to take the exercise seriously cheated less, but those who were told to compete to win cheated more.

"When we are part of a group of loyal members, traits associated with loyalty--such as honor, honesty, and integrity--are very salient in our minds," Gino writes. "But when loyalty seems to demand a different type of goal, such as competing with other groups and winning at any cost, behaving ethically becomes a less important goal."