Integrity - A New Model



By Werner Erhard and Michael C. Jensen

Social Science Research Network (SSRN)
Harvard Business School
NOM Unit Working Paper No. 12-074
National Bureau of Economic Research (NBER)
Paper #19986, Issued March 2014
European Corporate Governance Institute (ECGI)
Finance Working Paper No. 417/2014

*'positive' as used here is as it is used in the sciences – it does not mean something good or desirable, it means the way integrity actually is and operates

Abstract: We summarize our new positive theory of integrity that has no normative content, (positive as used here is from the discipline of economics – it does not mean something good or desirable, it means the way the world actually is and operates) and argue that there are large gains from putting integrity into finance – into both the theory and practice of finance. We define integrity as being whole and complete and unbroken. We argue that if finance scholars, teachers and practitioners take this approach to applications in finance there are huge gains to be achieved. Read more at SSRN. This paper is also available at:

Harvard Law School Forum on Corporate Governance and Financial Regulation

National Bureau of Economic Research (NBER), Also Online Appendix

European Corporate Governance Institute (ECGI)

Harvard Business School Working Knowledge



Academic Paper in Progress

*'positive' as used here does not mean something good or desirable, it means the way something actually is

Werner Erhard and Professor Michael C. Jensen discuss their positive model of integrity that links integrity and personal and corporate 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.

"Simply put, integrity as we define it provides access to incredible increases in performance - in whatever performance you are interested in - as well as the personal peace and self-confidence that comes from being a well-integrated person."- Michael Jensen, Texas A&M University Interview

This academic paper 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, 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 University 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; Distinguished Scholar/Teacher Lecture Series, McCombs School of Business, University of Texas, Austin, Tx, Nov. 12, 2009; Hankamer School of Business, Baylor University, Waco, TX, Nov. 13, 2009; Washington University Olin School of Business, March 26 2010; Wake Forest University, Schools of Business, January 31, 2011.

This paper in progress has been cited in the following academic publications:

The Value of Truth Telling, Negative memes in the infosphere pose mortal threats, transforming lies and other offensive messages into strategic disabilities, Hayes-Roth, Rick, Naval Post Graduate School

Toward Effective Codes: Testing the Relationship with Unethical Behavior Muel Kaptein, Journal of Business Ethics; Muel Kaptein


The Risk‐based Approach to Anti‐Money Laundering: Problems and Solutions, Journal of Money Laundering Control; Anna Simonova

The Value of Corporate Culture, Journal of Financial Economics; Luigi Guisoa, Paola Sapienzab, Luigi Zingalesc



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

Integrity: Without It Nothing Works:
Article published in Rotman Magazine: The Magazine of the Rotman School of Management, pp. 16-20, Fall 2009

A New Model of Integrity: The Missing Factor of Production (PDF file of Keynote and PowerPoint Slides)

Harvard Business School Working Knowledge:
A First Look at Faculty Research - Integrity: Without It Nothing Works

Simoleon Sense - Integrity: Without It Nothing Works:
Simoleon Sense curates the web for the best articles on behavioral economics, complex systems, decision making, psychology, value investing, and science.

A New Model of Integrity: An Actionable Pathway to Trust, Productivity and Value: Social Science Research Network

Presentation at the Center for Public Leadership, Kennedy School of Government, Harvard University: Social Science Research Network

Public Intelligence - Integrity: Without It Nothing Works

Dialogue with Werner H. Erhard and Michael C. Jensen. Integrity: Where Leadership Begins: Harvard University

"Beyond Coordination and Control Is... Transformation":, David Warsh

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

Integrity - A Business Conference: Photo Slide Presentation

Integrity- Without it Nothing Works: Harvard Business Publishing

A Man of Integrity- The Battalion Online: The Student Voice of Texas A&M

Harvard Business School: '‘First Look’' December 8, 2009

Harvard Business School: 'First Look' March 3, 2010

Watch Michael Jensen and Steve Zaffron discussing Integrity: Duisenberg School of Finance

Watch Michael Jensen's presentation on Integrity at HEC Paris

Cited in Handbook of Leadership Theory and Practice: by Nitin Nohria and Rakesh Khurana

Michael C. Jensen Delivers Georgetown Univeristy's McDonough Shool of Business Commenment Address

La integridad no es una virtud, es una ley

Entrevista: Michael C. Jensen Profesor Emérito De Harvard Business School "Muchos Directivos Mienten"

A New Model of Integrity - The Missing Factor of Production - (Google Books)

'Integrity', Leadership, Communication and Performance: The Most Valuable Post You Will Read This Year?

Harvard Business School Negotiation, Organizations & Markets Seminar, September 2007

USC Marshall School of Business, Finance and Economics Dept. - Distinguished Speaker Series, November 2007

Public Intelligence: Reference: Integrity - A New Model

Michael C. Jensen (Harvard Business School) - Keynote Speech at University of British Columbia on Integrity

A New Model of Corporate Integrity: Harvard Prof. Emeritus Michael Jensen discusses a new model of integrity and its application to corporate finance and management.

The Hidden Power of Integrity and Access to Vast Increases in Performance Harvard Professor Emeritus Michael C. Jensen's presentation given at entrepreneurship@UBC, University of British Columbia

A New Model of Integrity in Corporate Finance: Harvard Professor Emeritus Michael C. Jensen's presentation given at Kellogg School of Management


Read Werner Erhard's Academic Papers





Professor Michael C. Jensen spoke to Georgetown’s McDonough School of Business’ graduating seniors about integrity and authenticity


Michael C. Jensen on Integrity

2011 Commencement speech



Werner Erhard creates and shares new models and paradigms with great thinkers and universities around the world.


Werner Erhard at DePaul University Business Conference, pictured with Michael Jensen, Gonneke Spits


A Business Conference -

May 8, 2008


werner erhard harvard university

Working Paper by Werner Erhard and Michael C Jensen




ecgi werner erhard

Working Paper by Werner Erhard and Michael C Jensen