To have integrity is to show loyalty in action to one’s rational convictions and principles. Integrity is unity between intention and action. It means the rejection of hypocrisy. In order to live as rational productive beings, we must act according to reason and according to our principles.
Integrity also means that we do whatever is within our power to keep our promises: that our word can be relied upon.
A company that understood the value of keeping its word was UPS: when it promised to deliver, it did. James Casey the founder of UPS said “we have become known to all who deal with us as people of integrity, and that priceless asset is more valuable that anything else we possess.”
Integrity “means that one must never sacrifice one’s convictions to the opinions or wishes of others.” A good example of someone who lived by his convictions, in the face of pressure from others, was Warren Buffet, who followed the investing principles of Benjamin Graham. His stocks in 1999 were worth 5000 times their value in 1965. But at the start of the dotcom boom, as the value of Berkshire Hathaway’s shares fell, he came under pressure to go against his rules and invest in internet companies. But Buffet refused to compromise his principles, and his stance was vindicated when many of the new technology stocks crashed and Berkshire Hathaway quickly regained its value.
Sometimes integrity requires even greater courage. Johnson and Johnson had always prided itself on its commitment to its customers, and in fact the company’s credo stated that its first responsibility was to its customers. In 1982 someone bought some bottles of Tylenol capsules, laced them with poison, and returned them to the store. Seven people died. The company decided to go ahead with the very costly exercise of recalling approximately 31 million bottles, and replacing them with tablets. When the bottles were re-introduced several months later with tamper-proof seals, the company also included coupons for 80 million free bottles. Consumers returned to the product, and within several months Tylenol again had the greatest market share in its category.
Research shows that integrity is essential for effective leadership. When CEOs compromise their principles, it leads to cynicism amongst their staff. This produces declining motivation, and reduces commitment to company goals.