..WERNER ERHARD

Werner Erhard, Professor Michael Jensen and Steve Zaffron have developed a new model of integrity that links integrity with corporate and personal performance. They address integrity in a developing academic paper, whose primary purpose is to present a positive model of integrity that provides a powerful access to increased performance for individuals, groups, organizations, and societies.

The creation of this model reveals a causal link between integrity and increased performance. Through the work of clarifying and defining what integrity is and it’s causal link to performance, this model provides access to increased performance for private individuals, executives, economists, philosophers, policy makers, leaders, legal and government authorities.

This new model was initially presented at the Gruter Institute Conference on Values in June 2006. Since then it has been presented at the Center for Public Leadership, John F. Kennedy School of Government, Harvard University, Boston, MA, May 10, 2007, Simon School of Business, U. of Rochester; Fisher College of Business, Ohio State University, Columbus, OH, Sept. 2006, Nottingham College of Business, Nottingham, UK, ESADE Business School, Barcelona, Spain; HEC, Paris, France, Nov. 2006, Yale Symposium on Corporate Governance, Inaugural Lecture, (Yale Law School and Yale School of Organization and Management), New Haven, CT, January 2007, Gruter Institute Squaw Valley Conference: Law, Brain and Behavior, May 2007, Harvard Business School Negotiations Organizations and Markets Seminar, Sept. 2007; Yale School of Management, Sept. 2007: MIT Sloan School of Management Leadership Center, Cambridge, MA, Oct. 2007; Harvard Law School, Law, Economics and Organizations Research Seminar, Cambridge, MA, Oct. 2007; USC Marshall School of Business, Finance and Economics Dept. Distinguished Speaker Series, Nov. 2007; LeBow College Corporate Governance Conference, Lebow College of Business at Drexel University, Philadelphia, PA, April 2008; Special Seminar Series, Business Department, Juan Carlos III University, Madrid, Spain, April, 2008; Herbert Simon Lecture, Rajk Laszlo College, Corvinus University of Budapest, Budapest, Hungary, April 21, 2008; Exeter at Said Business School, Oxford, UK, April 24, 2008; University of Rochester Simon School of Business Alumni Seminar, NYC, May 5, 2008; DePaul U. Kellstadt School of Business, Chicago, IL, May 8, 2008; 1st IESE Conference on Humanizing the Firm and the Management Profession, IESE Business School, Barcelona, Spain, July 2, 2008 Stern Stewart International Finance Summit, Cape Town, South Africa, July 31, 2008; Concordia University John Molson School of Business, Montreal, Quebec, CA Sept. 16, 2008; Institute of Corporate Directors Conference on Governance and Financial Markets in North America, Montreal, Quebec, CA, Sept. 19, 2008; Duisenberg School of Finance, Amsterdam, Netherlands, Oct. 14, 2008; Paduano Faculty Research Symposium in Business Ethics, Stern School of Business, New York, Oct. 23, 2008; Olin School of Business Faculty Forum Sponsored by the Center for Research in Economics and Strategy and the Center for the Study of Ethics and Human Values, Washington University, St. Louis, MO, Nov. 6, 2008; Fisher School of Business, Ohio State U., Columbus, OH, Nov. 7, 2008; United States Air Force Academy, Platinum Series, Colorado Springs, CO, Jan. 21, 2009; Texas A&M Distinguished Lecture Series, College Station, TX, Feb. 10, 2009; Social Innovation Research Seminar Series, INSEAD, Fontainebleau, France, March 16, 2009; University of Texas, McCombs School of Business, Nov. 12, 2009; Dale P. Jones Business Ethics Forum, Hankamer School of Business, Baylor University, Nov. 13, 2009; Washington University Olin School of Business, March 26 2010; Wake Forest University, Schools of Business, January 31, 2011.

ACADEMIC PAPERS AND PRESENTATIONS:

"Putting Integrity Into Finance: A Purely Positive Approach" by Werner Erhard - Independent, and Michael C. Jensen - Harvard Business School; Social Science Electronic Publishing (SSEP), Inc.; National Bureau of Economic Research (NBER); European Corporate Governance Institute (ECGI)

Executive summary, Harvard Business School Working Knowledge: Behavior that lacks integrity leads to value destruction. This paper analyzes some common beliefs, actions, and activities in finance that are inconsistent with being a person or a firm of integrity. Each of these beliefs leads to a system that lacks integrity, i.e., one that is not whole and complete and therefore creates unworkability and destroys value. Focusing on these phenomena from the integrity viewpoint, the authors argue, makes it possible for managers to focus on the value that can be created by putting the system back in integrity and correcting the non-value maximizing equilibrium that exists in capital markets. Overall, this paper summarizes a purely positive theory of integrity that has no normative elements whatsoever, and demonstrates how it applies to both individuals and organizations. In effect, integrity is a factor of production just like knowledge, technology, labor, and capital, but it is undistinguished—and its affect (by its presence or absence) is huge. Key concepts include:

• Integrity matters. Not because it is virtuous, but because it creates workability.


• Workability increases the opportunity for performance, and maximum workability is necessary for realizing maximum value.


• Integrity thus becomes a necessary (but not sufficient) condition for value maximization-a proposition that should become an important element in every finance course in every business school .... Read the paper at SSRN

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

Integrity: A Positive Model that Incorporates the Normative Phenomena of Morality, Ethics, and Legality - Full Paper

Michael C. Jensen delivering the Commencement Address - McDonough School of Business, Georgetown University, on Integrity, Authenticity and Being Committed To Something Bigger than Yourself.

Harvard Announces “Beyond Agency Theory: The Hidden and Heretofore Inaccessible Power of Integrity” - by Michael C. Jensen and Werner Erhard, February 2010

Michael C. Jensen speaking on Beyond Agency Theory: The Hidden and Heretofore Inaccessible Power of Integrity - Presentation delivered at Wake Forest Universtiy, Jan 31, 2011.

A New Model of Integrity: The Missing Factor of Production, - presented March 26, 2010 at Washington University Olin School of Business

"Integrity: Without it Nothing Works", an interview of Michael Jensen by Karen Christensen on the topic of integrity as published in the Magazine of the Rotman School of Management, pp. 16-20, Fall 2009

A New Model of Integrity: An Actionable Pathway to Trust, Productivity and Value - PDF File of Keynote Slides) November 12, 2009

Michael C. Jensen presenting Integrity: A Positive Model that Incorporates the Normative Phenomena of Morality, Ethics and Legality - Kellstadt Graduate School of Business, Depaul University Business Conference, May 8, 2008

Integrity: Where Leadership Begins - A New Model of Integrity - Presentation at the Center for Public Leadership, Kennedy School of Government, Harvard University, June 18, 2007

Dialogue with Werner H. Erhard and Michael C. Jensen. Integrity: Where Leadership Begins - Center for Public Leadership, Kennedy School of Government, Harvard University, May 2007

Integridad: Un Modelo Positivo Que Incorpora Fenomenos Normativos de Moral, Etica y Legalidad - Abreviado

RELATED LINKS:

Harvard Business School Working Knowledge - Working Papers, April 27, 2012

“Integrity: A Positive Model that Incorporates the Normative Phenomena of Morality, Ethics and Legality” - Citations

Michael Jensen wins 2009 Morgan Stanley-American Finance Association Award for Excellence

"Beyond Coordination and Control Is... Transformation"- EconomicPrinciples.com

Michael Jensen’s and Werner Erhard’s Talk on Integrity - The Harvard Law School Forum on Corporate Governance and Financial Regulation -

Michael C. Jensen - Publications

Legal Ethics and Professional Responsibility - Legal Profession Blog, A Member of the Law Professor Blogs Network, May 2007

Do Markets Need Integrity?- A Publication of the Yale School of Management

Integtity is a Strange Loop - Legal Profession Blog, A Member of the Law Professor Blogs Network, May 2007

Integrity - A Business Conference- Photo Slide Presentation

MIT Sloan School of Management- Spotlight Archives: Leadership

Michael Jensen on Integrity - HEC Paris

Columbia University - Syllabus for Leadership in International and Public Affairs (pdf)

Michael C. Jensen and Steve Zaffron - Video discussion on Integrity at Duisenberg School of Finance

Handbook of Leadership Theory and Practice, - Nitin Nohria and Rakesh Khurana cite Integrity: A Positive Model that Incorporates the Normative Phenomena of Morality, Ethics and Legality

Integrity Paper - discussion at Compliance and Business Ethics for Private Equity Real Estate