First, personally I’ve never asked my employer to match an offer. I just leave.

I do think the thought process makes some sense though.

If I feel I’m underpaid I’m going to look around to confirm before talking to anyone.

If I get confirmation I’m being underpaid then I’m going to wonder why. Here’s where I have a choice… I either assume it’s because you’re intentionally underpaying because you think you can, or it’s because you don’t understand what you’re doing.

I know companies understand compensation because I’ve worked in management and on compensation planning software, that’s why I don’t talk about it.

More naive people might give you the benefit of the doubt, i.e. think you just don’t know what’s fair. Those people give you a chance to fix it, and only then learn that you’re intentionally underpaying them.

It does speak badly of the person but only in the sense that they’re naive and think you “mean well” in some sense.