Working Paper | HBS Working Paper Series | 2010

Integrity: A Positive Model That Incorporates the Normative Phenomena of Morality, Ethics, and Legality Abridged

by Werner H. Erhard, Michael C. Jensen and Steve Zaffron

Abstract

We present a positive model of integrity that, as we distinguish and define integrity, provides powerful access to increased performance for individuals, groups, organizations, and societies. Our model reveals the causal link between integrity and increased performance, in whatever way one chooses to define performance (for example, quality of life, or value-creation for all entities), and provides access to that causal link. Integrity is thus a factor of production as important as knowledge and technology. Yet the major role of integrity in productivity and performance has been largely hidden or unnoticed, or even ignored by economists and others. The philosophical discourse, and common usage as reflected in dictionary definitions, leave an overlap and confusion among the four phenomena of integrity, morality, ethics, and legality. This overlap and confusion confound the four phenomena so that the efficacy and potential power of each is seriously diminished. We show that defining integrity as honoring one's word, as we have defined "honoring one's word:" 1) provides an unambiguous and actionable access to the opportunity for superior performance and competitive advantage at the individual, organizational and social levels, and 2) empowers the three virtue phenomena of morality, ethics and legality. We also demonstrate that applying cost-benefit analysis to honoring your word guarantees that you will be untrustworthy. This paper, intended for use in our leadership course (see http://ssrn.com/abstract=1263835), is an abridged version of our full paper of the same title available at: http://ssrn.com/abstract=920625. This abridged paper is written under the assumption that the reader has read the following 5-page document that lays out the basic structure of our model and analysis. It is available at: http://ssrn.com/abstract=1511274.

Keywords: Trust; Performance Productivity; Technology; Knowledge; Moral Sensibility; Opportunities; Competitive Advantage; Legal Liability; Cost vs Benefits;

Citation:

Erhard, Werner H., Michael C. Jensen, and Steve Zaffron. "Integrity: A Positive Model That Incorporates the Normative Phenomena of Morality, Ethics, and Legality Abridged." Harvard Business School Working Paper, No. 10-061, February 2010.