Comments welcome
September 12, 2013
Harvard Business School Negotiation, Organizations and Markets Research Papers
HARVARD NOM UNIT RESEARCH PAPER NO. 13-078
BARBADOS GROUP WORKING PAPER NO. 13-01
Four Ways of Being that Create the Foundations of
A Great Life, Great Leadership,
and A Great Organization -PDF File of PowerPoint Slides
Presented by Michael C. Jensen at:
Alfred Lerner College of Business and Economics
University of Delaware
Newark, DE
March 20, 2013
Authors:
WERNER ERHARD
Independent
werhard@ssrn.com
MICHAEL C. JENSEN
Jessie Isidor Strauss Professor Emeritus, Harvard Business School
Chairman, Social Science Research Network, Inc. (SSRN)
mjensen@hbs.edu
FAIR USE: You may redistribute this document freely, but please do not post the electronic file on the
web. We welcome web links to this document at: http://ssrn.com/abstract=2207782
We revise our papers regularly, and providing a link to the original ensures that readers will receive the
most recent version. Thank you, W. Erhard, M. Jensen.
© Copyright 2013, Werner Erhard, Michael C. Jensen, Landmark Worldwide. All rights reserved
Electroniccopy
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Comments welcome
September 12, 2013
Abstract
We argue here that the four factors we identify as constituting the foundation for being a
leader and the effective exercise of leadership can also be seen as the foundations not
only for great leadership, but also for a high quality personal life and an extraordinary
organization. One can see this as a “value free” approach to values because, 1) integrity
as we define it (being whole and complete) is a purely positive phenomenon, 2)
authenticity is also a purely positive phenomenon (being and acting consistent with who
you hold yourself out to be for others and who you hold yourself to be for yourself), 3)
being committed to something bigger than oneself is also a purely positive phenomenon
(that says nothing about what that commitment should be other than it be bigger than
oneself), and 4) being cause in the matter as a declaration of the stand you take for
yourself regarding everything in your life is also a purely positive phenomenon.
We apply these principles to the Goldman Sachs’ experience with its Abacus Mortgage
Backed Securities Scandal in which Goldman violated 7 of their 13 Goldman Business
Principles. In addition, Goldman paid a $550 million fine to the SEC, a record at that
time.
Background: This address is based on our leadership research program (conducted with
Steve Zaffron and Kari Granger over the last ten years). That research is designed to
discover what it actually takes to create leaders – that is, to leave participants at the end
of the course being leaders and effectively exercising leadership as their natural self
expression.
Access to the full 1043 pages of the Slide-Deck textbook and other material used in the
Leadership Course at entrepreneurship@UBC, University of British Columbia,
Vancouver, B.C., Canada 26 – 28 June and 1 – 3 July, 2013 is available at:
http://ssrn.com/abstract=1263835
Earlier versions of this talk were presented at the Gruter Institute Innovation and Economic
Growth Conference, Squaw Valley, CA, May 28, 2010; at the Dale P. Jones Business Ethics
Forum, Hankamer School of Business, Baylor University, Waco, Texas, November 13, 2009; at
the Fordham University Conference: “Management Education Under Fire”, Fordham University,
New York, NY, May 11, 2010; at the Georgetown Business School Commencement, June 2011;
and at the Harvard Business School Club, Dallas, TX, January 2013.
© Copyright 2013, Werner Erhard, Michael C. Jensen, Landmark Worldwide. All rights reserved
Electroniccopy
copy available
available at:
Electronic
at:https://ssrn.com/abstract=2207782
http://ssrn.com/abstract=2207782
Four Ways of Being that Create the Foundations of A
Great Personal Life, Great Leadership and a Great
Organization
Alfred Lerner College of Business and Economics, U. of Delaware
Newark, DE
3/11/2013
Presenter
Michael C. Jensen
Jesse Isidor Straus Professor of Business, Emeritus, Harvard Business School
Co-Founder, Chairman, Integrity Officer, Social Science Electronic Publishing (SSRN)
Authors
Werner Erhard, Michael C. Jensen
These slides available at http://ssrn.com/abstract=2207782
Drawn from work over the past 8 years with our co-authors Steve Zaffron and Kari Granger in creating our
leadership course : “Being A Leader and the Effective Exercise of Leadership: An Ontological/
Phenomenological Model”, available at SSRN. See:
http://ssrn.com/abstract=1511274
http://ssrn.com/abstract=1585976
http://ssrn.com/abstract=1263835
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic
copy available at: https://ssrn.com/abstract=2207782
Electronic copy available
at: http://ssrn.com/abstract=2207782
Shifting Business School Curriculums to Emphasize
“Being” Rather than “Knowing”
2
I will spend my time today discussing background material
relevant to how we can shift business school curriculums so
as to create value for individuals and society as a whole. And
how you can shift your own life, your family and your
organization.
Providing our students actionable access to these ways of
being will make a huge improvement in the world.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Shifting Business School Curriculums to Emphasize
“Being” Rather than “Knowing”
3
Behind this is the notion that we in business schools must
change our curriculum so that it is directed at providing access
for our students to being leaders and being managers and
being persons of integrity. In short:
An Epistemological Mastery Leaves One Knowing
An Ontological Mastery Leaves One Being
We think we are turning out graduates who are being
something rather than just knowing about something. These
are very different objectives.
As in being innovative or being a leader as compared with
knowing about innovation or leadership and able to discuss
and debate the issues in a knowledgeable way. And the
difference has not been discussable.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Background Of This Work
What I will discuss today is one result of our team’s 10 years
of research into leadership and the development of a new
one-semester leadership course that actually creates leaders.
See the following for the course materials used at the course
taught at Asia Plateau, Panchgani India under the auspices of
the IC Centre for Governance and MW Corp, Nov. 2010, at
the Geisel School of Medicine at Dartmouth College, June
2012, and at the Whistler Lodge, British Columbia, CA
October 2012
http://ssrn.com/abstract=1263835
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
The Source of These Principles Is Ontology: The
Science of Being
5
Not “Ontotheology” as Harvard philosopher Hilary Putnam
terms the version of ontology dealing with the existence of God.
It is time we pay more attention to being and how one affects
being. So do not be surprised if what I say today lands with you
as a bit strange.
You may want to try it on before you reject it out of hand.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
6
The Four Ways of Being that Are the Foundations of
A Great Personal Life, Great Leadership, and A Great
Organization
1. Being Authentic:
Ø Being and acting consistent with who you hold yourself out to be for others,
and who you hold yourself to be for yourself. When leading, being authentic
leaves you grounded, and able to be straight without using force.
2. Being Cause In the Matter of Everything In Your Life:
Ø Being Cause in the Matter is a stand you take for yourself and life – and acting
from that stand. It leaves you with power.You are never a victim.
3. Being Committed to Something Bigger than Oneself:
Ø Source of the serene passion (charisma) required to lead and to develop
others as leaders, and the source of persistence (joy in the labor of) when the
path gets tough.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
The Four Ways of Being That Are the Foundations of
a Great Personal Life, Great Leadership, and A Great
Organization
7
4. Being A Person or an Organization of Integrity (in our
model a purely positive phenomenon):
Ø Being whole and complete – achieved by “honoring one’s
word” (creates workability, develops trust).
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
1. AUTHENTICITY: Are You Being Authentic?
Quoting Chris Argyris who (after 40 years of studying us
8
human beings) says on the subject of our inauthenticity:
“Put simply, people consistently act inconsistently,
unaware of the contradiction between
their espoused theory and their theory-in-use,
between the way they think they are acting,
and the way they really act.”
Harvard Business Review,
“Teaching Smart People How to Learn” (1991, pp. 99-109)
And if you think this does not apply to you, you are fooling
yourself about fooling yourself.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
More on Authenticity
A common example of being inauthentic: pretending to be
9
some way you are not actually being, that is, hiding what you
actually think or feel.
Inauthenticity can be thought of as covering up what is actually
going on with you, or covering up something that happened or
didn’t happen in your life, or thought of as a façade or a face
you put on.
Because it is painful to be caught being inauthentic, everyone
goes to great lengths to avoid their inauthenticities.
And this means we are being inauthentic about being
inauthentic.
And this leads us to a surprising conclusion:
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
The Path To Authenticity Is
Being Authentic About Our Inauthenticities
One cannot pretend to be authentic. That, by definition, is
inauthentic.
10
Being authentic is being willing to discover, confront, and tell
the truth about your inauthenticities – where you are not being
genuine, real, or authentic.
Specifically, where in your life are you not being or acting
consistent with who you hold yourself out to be for others, and
where are you not being or acting consistent with who you
hold yourself to be for yourself.
The actionable pathway to authenticity is to:
Be authentic about your inauthenticities —
both to yourself and to others.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
The Path To Authenticity:
Being Authentic About Our Inauthenticities
Most of us think of ourselves as being authentic; however,
each of us in certain situations, and each of us in certain ways,
is consistently inauthentic. And, because we avoid at all costs
confronting our inauthenticities, we are consistently inauthentic
about being inauthentic – not only with others, but with
ourselves as well.
11
And an organization that cannot be authentic about it’s
inauthenticities will experience great conflicts, costs, and loss
of reputation.
The attempt to be authentic on top of our inauthenticities is like
putting cake frosting on cow dung, thinking that will make the
cow dung go down well.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Is Being Authentic Important To
Being A Leader?
Quoting former Medtronics CEO and now Harvard Business
School Professor of Leadership, Bill George:
12
“After years of studying leaders and their traits, I believe
that leadership begins and ends with authenticity.” (2003, p. 11)
To be a leader you must be big enough to be authentic about
your inauthenticities. This kind of bigness is a sign of power,
and is so interpreted by others.
Being a leader requires that you be absolutely authentic, and
true authenticity begins with
being authentic about your inauthenticities, and
almost no one does this.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Examples Of Our Inauthenticities
We all want to be admired, and almost none of us is willing to
13confront just how much we want to be admired, and how readily
we will fudge on being straightforward and completely honest in
a situation where we perceive doing so threatens us with a loss
of admiration.
We also all want to be seen by our colleagues as being loyal,
protesting that loyalty is a virtue even in situations where the
truth is that we are acting “loyal” solely to avoid the loss of
admiration.
And, in such situations, how ready we are to
sacrifice integrity to maintain the pretense of being loyal, when
the truth is that we are “being loyal” only because we fear losing
the admiration of our close colleagues.
In addition, most of us have a pathetic need for looking good,
and almost none of us is willing to confront just how much we
care about looking good – even to the extent of the silliness of
pretending to have followed and understood something when we
haven’t.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Each Of Us Is
Inauthentic In Certain Ways
While this may sound like a description of this or that person
you know, it actually describes each person in this room,
including me.
14
We are all guilty of being small in these ways – it comes with
being human.
Great leaders are noteworthy in having come to grips with
these foibles of being human – not eliminating them, but being
the master of these weaknesses when they are leading.
If you watch carefully in life, you will have the opportunity to
catch yourself being small in these ways. While you won’t like
seeing this, by distinguishing these weaknesses in yourself,
you will give yourself a powerful opportunity to master these
“constraints”.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
The Actionable Access to Authenticity
As we have said, being authentic about your inauthenticities is
15
the
path to authenticity.
In order to achieve this you must find in yourself, that “self” that
leaves you free to be authentic about your inauthenticities.
That “self”, the one required to be authentic about your
inauthenticities, is who you authentically are.
And you will know when this process is complete when you are
free to be publicly authentic about your inauthenticities, and
have experienced the freedom, courage, and peace of mind that
comes from doing so.
And this is especially so when you are authentic with those
around you for whom those inauthenticities matter (and who are
likely to be aware of them in any case).
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
2. BEING CAUSE IN THE MATTER
16
By “Being Cause in the Matter” we mean being cause in the
matter of everything in your life as a stand you take for
yourself and life – and acting from that stand.
To take the stand that you are cause in the matter contrasts
with it being your fault, or that you failed, or that you are to
blame, or even that you did it.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
It Is Not True that You Are The Cause of
Everything in Your Life
17
That you are the cause of everything in your life is a place to
stand from which to view and deal with life – a place that
exists solely as a matter of your choice.
The stand that one is cause in the matter is a declaration, not
an assertion of fact. It simply says, “you can count on me
(and, I can count on me) to look at and deal with life
from the perspective of my being cause in the matter.”
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Being Cause in the Matter Means You Give Up the
Right to Be a Victim
18
When you have taken the stand (declared) that you are cause
in the matter of your life, it means that you give up the right
to assign cause to the circumstances, or to others.
That is you give up the right to be a victim.
You also give up the right to assign cause to the waxing and
waning of your state of mind – all of which, while
undoubtedly soothing, leave you helpless (at the effect of).
At the same time taking this stand does not prevent you from
holding others responsible.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
It Is Not True that You Are The Cause of
Everything in Your Life
19
Being cause in the matter does not mean that you are taking
on the burden of, or that you will be praised for or blamed
for anything in the matter. And, it does not mean that you
won't fail.
However, when you have mastered this aspect of the
foundation required for being a leader and exercising
leadership effectively, you will experience a state change in
effectiveness and power in dealing with the challenges of
leadership (not to mention the challenges of life).
A great organization also gives up the right to blame others or
the circumstances for anything that is going on with it or in
its environment.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
3. BEING COMMITTED TO SOMETHING BIGGER
THAN ONESELF
20
What we mean by “being committed to something bigger than
oneself” is being committed in a way that shapes one’s being
and actions so that those actions are in the service of realizing
something beyond one’s personal concerns for oneself –
beyond a direct personal payoff.
As they are acted on, such commitments create something to
which others can also be committed and have the sense
that their lives are about something bigger than themselves.
This is an important aspect of a great personal life, great
leadership and a great organization.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Being Committed To Something Bigger than
Oneself Is the Source of Passion
Without the passion that comes from being committed to
something bigger than yourself, you are unlikely to persevere
in the valley of tears that is an inevitable experience in the
lives of all true leaders. Times when nothing goes right, there
is no way, no help is available, nothing there except what you
can do to find something in yourself – the strength to
persevere in the face of impossible, insurmountable hurdles
and barriers.
21
When you are committed to something bigger than yourself
and you reach down inside, you will find the strength to
continue (joy in the labor of).
And finally, being committed to something bigger than yourself
leaves you with the passion required to empower the brain’s
executive function to “not© Copyright
eat the
marshmallow”. (1990)
2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Example of a Valley of Tears That Almost
Everyone Experiences: The Mid-Life Crisis
At some point in life we all stop measuring time from the
beginning and start measuring it from the end. It shifts from how
far have I come to how much time and opportunity do I have
left?
No matter how good you look, no matter how good you’ve
gotten your family to look, and no matter how much wealth,
fame, power and position you have amassed, you will
experience a profound lack of fulfillment – the incompleteness,
emptiness and pain expressed by the common question:
Is This All There Is?
Let us be clear: There is nothing inherently wrong with wealth,
good looks, fame, power or position, but contrary to almost
universal belief “they will never be enough”.
And facing up to that leaves people and organizations
disoriented, disturbed and© Copyright
lost.2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
22
Electronic copy available at: https://ssrn.com/abstract=2207782
Leadership and “Is This All There Is?”
No matter how good you look or how much you have
23personally amassed, it will never be enough to avoid this crisis.
Dealing with the crisis of “Is this all there is?” lies in having a
commitment to the realization of a future (a cause) that leaves
you with a passion for living.
This principle applies to corporate entities as well as to human
beings. Value creation for both is the scorecard for success.
Value creation is not the source of corporate or personal
passion and energy.
Being committed to something bigger than oneself is the
source of that passion and energy.
Every individual and every organization has the power to
choose that commitment—there is no “right answer”. It is
creating what lights up you and your organization.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Summary:
Committed To Something Bigger than Oneself
The following is a quotation from George Bernard Shaw from
his play “Man and Superman” (the epistle dedicatory to the
play) that captures this idea of being committed to something
bigger than oneself:
24
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Summary:
Committed To Something Bigger than Oneself
“This is the true joy in life, the being used for a purpose
recognized by yourself as a mighty one; the being a force of
nature instead of a feverish selfish little clod of ailments and
grievances complaining that the world will not devote itself to
making you happy.
25
“I am of the opinion that my life belongs to the whole
community and as long as I live, it is my privilege to do for it
whatever I can.
“I want to be thoroughly used up when I die, for the harder I
work the more I live. I rejoice in life for its own sake. Life is no
“brief candle” to me. It is a sort of splendid torch which I have
got hold of for the moment, and I want to make it burn as
brightly as possible before handing it on to future generations.”
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
4. END – The Following Slides Were Not Covered
Due to time constraints
26
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
4. INTEGRITY: A Positive Model
In our model of Integrity, Integrity is a purely positive
27
phenomenon not a virtue.
Definition: Webster’s New World Dictionary: 1. the quality of
state of being complete; unbroken condition; wholeness;
entirety - 2. the quality or state of being unimpaired; perfect
condition; soundness - 3. the quality or state of being of sound
moral principle; uprightness, honesty, and sincerity
We use integrity in this model according to Definitions 1 and 2.
Defined this way integrity is a positive phenomena, not a
virtue.
There is nothing inherently good or bad about it, it is just the
way the world is. (We will show how morality & ethics are
related to integrity later.)
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Integrity: Definition
An object or system has integrity when it is whole and
28
complete
Any diminution in whole and complete results in a diminution
in workability
Think of a wheel with missing spokes, it is not whole and
complete. It will become out-of-round, work less well and
eventually stop working entirely.
Likewise, a system has integrity when it is whole and complete
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
The Law of Integrity
The Law of Integrity states:
29
As integrity (whole and complete) declines, workability
declines, and as workability declines, value (or more generally,
the opportunity for performance) declines.
Thus the maximization of whatever performance measure
you choose requires integrity.
Violating the Law of Integrity generates painful consequences
just as surely as violating the law of gravity. Put simply (and
somewhat overstated): “Without integrity nothing works”
Think of this as a heuristic: If you or your organization operate
in life as though this heuristic is true, performance will increase
dramatically.
And the impact on performance is huge: 100% to 500%
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Integrity For A Person (or any Human Entity Such As
An Organization)
In this positive model, integrity for a person is a matter of a
person’s word, nothing more and nothing less.
30
You are a man or woman of integrity, and enjoy the benefits
thereof, when your word is whole and complete.
Your word includes the speaking of your actions as in “actions
speak louder than words”
Integrity is Honoring Your Word
While keeping your word is fundamentally important in life, you
will not be able to always keep your word (unless you are
playing a small game in life).
However, you can always honor your word
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Integrity: Honoring Your Word
1
Is keeping your word
OR:
2
Whenever you will not be keeping your word, just as soon
as you become aware that you will not be keeping your
word (including not keeping your word on time) saying to
everyone impacted:
31
a. That you will not be keeping your word, and
b. That you will keep that word in the future, and by when,
or that you won’t be keeping that word at all, and
c. What you will do to deal with the impact on others of the
failure to keep your word (or to keep it on time).
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Your Word Defined
W1. What You Said: Whatever you said you will do, or will not
32
do (and in the case of do, doing it on time).
W2. What You Know: Whatever you know to do, or know not
to do, and if it is do, doing it as you know it is meant to be
done (and doing it on time), unless you have explicitly said to
the contrary.
W3. What Is Expected: Whatever you are expected to do or
not do (unexpressed requests) and in the case of do, doing it
on time, unless you have explicitly said to the contrary.
W4. What You Say Is So: Whenever you have given your
word to others as to the existence of some thing or some state
of the world, your word includes being willing to be held
accountable that the others would find your evidence makes
what you have asserted valid for themselves.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Your Word Defined (cont’d)
W5. What You Stand For: Whether expressed in the form of a
33
declaration made to one or more people, or to yourself, as well
as what you hold yourself out to others as standing for
(formally declared or not).
W6. Morality, Ethics and Legality: The Social Moral
Standards, the Group Ethical Standards and the Governmental
Legal Standards of right and wrong, good and bad behavior in
the society, groups and state in which I enjoy the benefits of
membership are also my word (what I am expected to do) . . .
Unless I have explicitly and publicly expressed my
intention to not keep one or more of those standards, and I
am willing to bear the costs of refusing to conform to these
Standards (the rules of the game I am in).
NOTE: This is your Word, not Integrity
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
A Sobering Thought
Why is it that almost everyone acts without integrity in one way
34
or another, despite the huge costs it imposes on them?
Everyone in this room sees themselves as persons of integrity
— including me.
The bad news:
I can say with great confidence that no one in this room is a
person completely in integrity — including me.
That self-satisfied view is one of the causes of the universal lack
of integrity in the world. I repeat: the common belief that we
have “made it” is one of the factors contributing to the lack of
integrity.
The fact is: integrity is a “mountain with no top” so we had better
get used to (and even like) climbing.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
The Costs of Dealing with an Object, Person,
Group or Entity that Is Out Of Integrity
Consider the experience of dealing with an object that lacks
35
integrity. Say a car or bicycle or air conditioning system
When it is not whole and complete and unbroken (that is a
component is missing or malfunctioning) it becomes
unreliable, unpredictable, and it creates those characteristics
in our lives
The car fails in traffic, we create a traffic jam, we are late for
appointments, fail to perform, disappoint our partners,
associates, and firms
In effect, the out-of-integrity car creates a lack of integrity in
our life with all sorts unworkability fallout
And this is true of all our associations with persons, or entities
that are out of integrity. The effects are huge, but generally
attributed to something other
of Jensen,
integrity.
© Copyrightthan
2010-2013.the
Werner lack
Erhard, Michael
Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Costs of Lack of Integrity and The Veil of
Invisibility
The “Integrity-Performance” Paradox
36
People & organizations while committed to performance
systematically sacrifice integrity in the name of increasing
performance and thereby reduce performance.
How can this occur?
If Operating With Integrity Is So Productive, Why Do
People Systematically Sacrifice their Integrity and Suffer
the Consequences? And, why are they blind to these
effects?
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Eight Causes of the Veil of Invisibility - 1
1. Integrity Is A Virtue
37
For most people and organizations integrity exists as a virtue
rather than as a necessary condition for performance. As a
virtue, integrity is easily sacrificed when it appears a
person or organization must do so to “succeed”.
For many people virtue is valued only to the degree that it
engenders the admiration of others, and as such it is easily
sacrificed especially when it would not be noticed or can be
rationalized.
Sacrificing integrity as virtue seems no different than
sacrificing courteousness, or new sinks in the mens room.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Eight Causes of the Veil of Invisibility - 2
2. Self Deception about our own out-of-integrity behavior.
38
People generally do not see when they are out of integrity. In
fact they are mostly unaware that they have not kept their
word. What they see is the “reason”, rationalization, or excuse
for not keeping their word.
Because people cannot see their out-of-integrity behavior,
it is impossible for them to see the cause of the
unworkability in their lives and organizations — the direct
result of their own violations of the law of integrity .
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Eight Causes of the Veil of Invisibility - 3
3. Relating To Integrity As Keeping One’s Word
39
The belief that integrity is keeping one’s word – period –
leaves no way to maintain integrity when it is not possible, or
when it is inappropriate, or one simply chooses not to keep
one’s word.
And that leads to concealing not keeping one’s word
which adds to the veil of invisibility about the impact of
violations of the Law of Integrity
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Eight Causes of the Veil of Invisibility - 4
4. Not Seeing That Integrity Is A Mountain With No Top
40
To the extent that people are aware of integrity and the costs
of out-of-integrity behavior they systematically believe that
they are in integrity or, if not in integrity at any moment, they
believe they can put themselves back into integrity and be a
person of complete integrity.
Actually getting that integrity is a mountain with no top, and
therefore we had better learn to enjoy climbing, leaves us as
individuals with power.
Knowing that that we will never “get there” opens us up
to tolerance of (and an ability to see and deal productively
with) our own out-of-integrity behavior as well as that of
others.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Eight Causes of the Veil of Invisibility - 5
5. FEAR of announcing you are not going to keep your word
41
When maintaining your integrity (acknowledging that you are
not going to keep your word and cleaning up the mess that
results) occurs for you as a threat to be avoided (like it was
when you were a child), rather than simply a challenge to be
dealt with, then you will find it difficult to maintain your integrity.
When not keeping their word, most people fear the possibility
of looking bad and the consequent loss of power and respect.
They choose the apparent short-term gain of avoiding that fear
by hiding that they will not keep their word. This conceals the
long-term loss caused by violations of the Law of Integrity
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Eight Causes of the Veil of Invisibility – 5 (cont’d)
Thus out of fear we are blinded to (and therefore
42
mistakenly forfeit) the power and respect that accrues
from acknowledging that one will not keep one’s word or
that one has not kept one’s word.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Eight Causes of the Veil of Invisibility - 6
6. Integrity is not seen as a factor of production.
43
Leading people to make up false causes and unfounded
rationalizations as the source(s) of failure
Which in turn conceals the violations of the Law of Integrity as
the source of the reduction of the opportunity for performance
that results in failure
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Eight Causes of the Veil of Invisibility - 7
7. NOT Doing Cost/Benefit Analysis on GIVING One’s
44
Word
When giving their word, most people do not consider fully what
it will take to keep that word. That is, people do not do a cost/
benefit analysis on giving their word.
In effect, when giving their word, most people are merely
SINCERE (well-meaning) or placating someone, and don’t
even think about what it will take to keep their word. This
failure to do a cost/benefit analysis on giving one’s word is
IRRESPONSIBLE.
Such irresponsible giving of one’s word is a major source of
the mess left in the lives of people and organizations. Indeed
people often do not even KNOW they HAVE given their word.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Eight Causes of the Veil of Invisibility – 7 (cont’d)
People generally do not see the giving of their word as:
45
“I AM going to MAKE this happen”
— If you are not doing this you will be out of integrity
Generally people give their word INTENDING to keep it. That
is, they are merely sincere.
If anything makes it difficult or even inconvenient to deliver,
then they provide REASONS instead of results.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Eight Causes of the Veil of Invisibility - 8
8. DOING Cost/Benefit Analysis on HONORING One’s
46
Word
People almost universally apply cost/benefit analysis to
honoring their word.
Treating integrity as a matter of cost/benefit analysis
guarantees you will not be a trustworthy person, and with
a small exception, guarantees you will not be a person of
integrity.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Integrity, Trust and the Economic Principle of
Cost-Benefit Analysis
If I apply cost/benefit analysis to honoring my word, I am either
47
out of integrity to start with because I have not stated the cost/
benefit contingency that is in fact part of my word (I lied), or to
have integrity when I give my word, I must say something like
the following:
“I will honor my word when it comes time for me to honor my
word if the costs of doing so are less than the benefits.”
Such a statement, while leaving me with integrity is unlikely to
engender trust.
In effect I just told you that I am an unmitigated
opportunist. My word means nothing.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Integrity, Trust and the Economic Principle of
Cost-Benefit Analysis (cont’d)
In a sense, I have given you my word that you cannot trust
48
me to honor my word.
At best you are left guessing what costs and benefits I will be
facing when it comes time for me to honor my word.
And if the costs are greater than the benefits (as I see them) I
will not honor my word. That is my word is meaningless.
Therefore I would be for you an untrustworthy person.
The Bottom Line: If you choose to be a person of integrity, you
have no choice when it comes time to honor your word.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Integrity, Trust and the Economic Principle of
Cost-Benefit Analysis (cont’d)
To Repeat: In order to be in integrity you must apply cost/
49
benefit analysis to giving your word.
If I take on integrity as who I am, then I should and will think
carefully before I give my word, and I will recognize I am
putting myself at risk when I do so.
And I will never give my word to two or more things that are
mutually inconsistent.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Integrity, Trust and the Economic Principle of
Cost-Benefit Analysis (cont’d)
In a very real sense being a person of integrity starts with me
50
giving my word to myself: My word to myself that I am a
person of integrity.
And when I do that I say to myself:
“I am going to make this happen.”
Not: “I am going to try to make this happen” or “I hope this will
happen”
As Jedi Master Yoda says to Luke Skywalker in “Star Wars
Episode 5 – The Empire Strikes Back”:
“DO or NOT DO. There is no TRY.”
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
A Picture of Integrity
What would your life be like, and what would your
51
performance be, if it were true that:
You have done what you said you would do and you did it on
time.
You have done what you know to do, you did it the way it was
meant to be done, and you did it on time.
You have done what others would expect you to do (their
unexpressed requests) even if you never said you would do it,
and you did it on time, or you have informed them that you will
not meet their expectations (unexpressed requests).
and you have informed others of your expectations for them
and have made explicit requests to those others.”
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
A Picture of Integrity (cont’d)
And when you are not going to follow one or more of the rules
52
of any game that you are in, you have informed all others of
your intention to not follow those rules & willingly bear the
consequences of not doing so.
And whenever you realized that you were not going to do any
of the foregoing, or not going to do it on time:
You have said so to everyone who might be impacted, and
you did so as soon as you realized that you wouldn't be doing
it, or wouldn't be doing it on time, and
If you were going to do it in the future you have said by when
you would do it, and
You have dealt with the consequences of your not doing it on
time, or not doing it at all, for all those who are impacted by
your not doing it on time,©or
not2010-2013.
doing
at Michael
all Jensen, Vanto Group. All Rights Reserved.
Copyright
Wernerit
Erhard,
Electronic copy available at: https://ssrn.com/abstract=2207782
A Picture of Integrity (cont’d)
In a sentence, you have done what you said you would do, or
53
you have said you are not doing it; you have nothing hidden,
you are truthful, forthright, straight and honest. And you have
cleaned up any mess you have caused for those depending
on your word.
And Almost Unimaginable
What if others operated in this way with you?
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Application of these Principles to the Goldman
Sachs’ Abacus 2007-AC1 Mortgage Backed
Securities Issue
What follows is a discussion of the Goldman Sachs’
inauthentic and out-of-integrity behavior regarding the
formation and marketing of its Abacus 2007-AC1 CDS
product.
An experience that includes Goldman’s $550 million
settlement to the SEC – at the time, the largest such SEC
settlement in history.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Application to Organizations -- Consider Goldman
Sachs Difficulties Associated with Its Abacus Deal
Goldmans’
actions in its Abacus 2007-AC1 CDS product appear
55
to have violated 7 of their 13 “Goldman Sachs Principles” (their
self-declared statement of what Goldman stands for). The first of
those principles is:
“Our Clients’ Interests Always Come First”
After the organization converted from a private partnership to a
publicly held corporation it changed. We conjecture that the
access to substantial amounts of capital fostered the increased
profitability of trading and the rise of traders to the top of the
organization. Lloyd Blankfein and much of the top management
are from the trading side of the business.
Traders have no clients, only counterparties. The historical
advisory side of the business does have clients.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
The Abacus 2007-AC1 $2 Billion Synthetic CDO
Issue
Put
together by Goldman with ACA Capital as a way to allow
56
some clients to bet against the US housing market —
particularly the overvalued mortgages that Goldman and other
Wall Street players made available to the worldwide capital
markets through such mortgage-backed securities.
What Goldman did not reveal to the markets or the buyers of the
Abacus securities was that it was paid $20 million by Paulson
and Company to create Abacus and to allow Paulson and
company to select the mortgage securities in Abacus. Paulson
intended to and did sell large amounts of Abacus short after
having selected securities that were almost certain to default.
And a large fraction of the securities in Abacus did default within
6 months imposing large losses on the Goldman clients who
purchased the Abacus securities.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
The Abacus 2007-AC1 $2 Billion Synthetic CDO
Issue
Indeed,
Goldman’s logo (along with that of ACA Capital) is on
57
every page of the pitch book.
There was no mention of the role of Paulson and Company
played in selecting the Abacus securities in the offering materials
provided to the market, or that Paulson and Company was
shorting the Abacus securities.
See the next slide’s imperfectly rendered first page of that slide
deck and the disclaimer page that follows it.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
58
ABACUS 2007-AC1
$2 Billion Synthetic CDO
Referencing a static RMBS Portfolio
Selected by ACA Management, LLC
February 26, 2007
The information contained herein is indicative
only and the actual terms of any transaction will
be set forth in the definitive Offering Circular.
Capitalized terms but not defined herein shall
have the meanings set forth in the definitive
Offering Circular.
CONFIDENTIAL – INDICATIVE TERMS
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Disclaimer
None of the Issuer, Goldman Sachs (as used herein, such term shall include Goldman, Sachs & Co. and all of
its affiliates), the Portfolio Selection Agent or any of their respective affiliates makes any representation or
59 warranty, express or implied, as to the accuracy or completeness of the information contained herein and
nothing contained herein shall be relied upon as a promise or representation whether as to the past or
future performance. The information includes hypothetical illustrations and involves modeling components
and assumptions that are required for purposes of such hypothetical illustrations. No representations are
made as to the accuracy of such hypothetical illustrations or that all assumptions relating to such
hypothetical illustrations have been considered or stated or that such hypothetical illustrations will be
realized. The information contained herein does not purport to contain all of the information that may be
required to evaluate such securities, and each recipient is encouraged to read the Offering Circular and
should conduct its own independent analysis of the data referred to herein. The Issuer, Goldman Sachs,
the Portfolio Selection Agent and their respective affiliates disclaim any and all liability relating to this
information, including, without limitation, any express or implied representation or warranty for statements
contained in and omissions from this information. None of the Issuer, Goldman Sachs or any of their
respective affiliates expects to update or otherwise revise the information contained herein except by
means of the Offering Circular. Additional information may be available on request. The securities are
obligations of the Issuer and are not issued by, obligations of, or guaranteed by Goldman Sachs, the
Portfolio Selection Agent or their respective affiliates, or other organizations. The obligations of the Issuer
are not deposit obligations of any financial institution. The securities described herein are complex,
structured securities and there is no assurance that a secondary market for such securities will exist at any
time. Accordingly, prospective investors should be prepared, and have the ability, to hold such securities
until their respective stated maturities or stated redemption dates. The Portfolio Selection Agent’s
participation in the transaction is subject to review and approval of its credit committee, senior
management and counsel. No credit or other approval is implied, or shall be construed, by delivery of the
information contained herein.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Goldman Violated 3 of the 4 Basic Principles We
Have Explicated Above
Goldman
was:
60
1. Out of integrity because it did not honor its word: Violating in
part or in whole, 7 of its 13 “Goldman Sachs Principles”.
2. Inauthentic because it was not true to what it holds itself out
to be for itself and for its clients and the public, and denies it.
3. Not committed to something bigger than itself. There is
nothing I could find in the Goldman literature indicating that it
was committed to anything in the world bigger than itself. For
example, two alternatives might be:
A commitment to
1.
2.
Ensure the efficient functioning and transparency of world-wide
capital markets
Reduce the cost and increase the availability of investment capital
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
What Goldman Missed
It is as simple as this:
61
When
Goldman collaborated in the creation and sale of these
securities to its clients it failed to notice it was giving its word.
Participating in the creation and sale of such investment vehicles
and selling them to their clients under the Goldman logo is a
dramatically different role than simply making a market in
securities that someone else has created.
Goldman is in effect giving its word to its client-buyers of Abacus
that the value of such securities is equal or better than the price
they are charging for them.
Not seeing the difference between mere trading and the
production and sale of such instruments under it own logo is a
dramatically different activity than simply putting buyer and seller
together in an impersonal market making role.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
What Goldman Missed (cont’d)
Although the pitch book carried warnings, and denials that
62
Goldman
was making any recommendations, the prominent use
of the Goldman logo, coupled with the long time pledge of “Our
Clients’ Interests Always Come First”, amount to Goldman
giving its word to the purchasers of these securities that
Goldman was putting them first.
Moreover, all this was being done in a context in which Goldman
believed the residential mortgage market was likely to
experience steep declines in value. Consequently the firm as a
whole was betting that home mortgages would decline in value
-- what was known in the firm as the “big short”. Simultaneously
creating mortgage backed securities which its clients would
purchase while simultaneously engaging in the “big short” to bet
against the housing market is both out of integrity and
inauthentic.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
“Goldman Sachs Principles”: Those In Red
Were Apparently Violated
Source: http://www2.goldmansachs.com/our-firm/our-people/business-principles.html
63
“Our clients' interests always come first.
Our experience shows that if we serve our clients well, our own success will follow.
“Our assets are our people, capital and reputation.
If any of these is ever diminished, the last is the most difficult to restore. We are dedicated to complying fully with the letter
and spirit of the laws, rules and ethical principles that govern us. Our continued success depends upon unswerving
adherence to this standard.
“Our goal is to provide superior returns to our shareholders.
Profitability is critical to achieving superior returns, building our capital, and attracting and keeping our best people.
Significant employee stock ownership aligns the interests of our employees and our shareholders.
“We take great pride in the professional quality of our work.
We have an uncompromising determination to achieve excellence in everything we undertake. Though we may be involved
in a wide variety and heavy volume of activity, we would, if it came to a choice, rather be best than biggest.
“We stress creativity and imagination in everything we do.
While recognizing that the old way may still be the best way, we constantly strive to find a better solution to a client's
problems. We pride ourselves on having pioneered many of the practices and techniques that have become standard in the
industry.
“We make an unusual effort to identify and recruit the very best person for every job.
Although our activities are measured in billions of dollars, we select our almost one by one. In a service business, we know
that without the best people, we cannot be the best firm.
“We offer our people the opportunity to move ahead more rapidly than is possible at most other places.
Advancement depends on merit and we have yet to find the limits to the responsibility our best people are able to assume.
For us to be successful, our men and women must reflect the diversity of the communities and cultures in which we operate.
That means we must attract, retain and motivate people from many backgrounds and perspectives. Being diverse is not
optional; it is what we must be.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
Goldman Sachs Principles
Goldman Sachs Principles (continued)
http://www2.goldmansachs.com/our-firm/our-people/business-principles.html
“We stress teamwork in everything we do.
64
While individual creativity is always encouraged, we have found that team effort often produces the best results. We have no
room for those who put their personal interests ahead of the interests of the firm and its clients. The dedication of our
people to the firm and the intense effort they give their jobs are greater than one finds in most other organizations. We think
that this is an important part of our success.
“We consider our size an asset that we try hard to preserve.
We want to be big enough to undertake the largest project that any of our clients could contemplate, yet small enough to
maintain the loyalty, intimacy and the esprit de corps that we all treasure and that contribute greatly to our success.
“We constantly strive to anticipate the rapidly changing needs of our clients and to develop new services to meet those
needs.
We know that the world of finance will not stand still and that complacency can lead to extinction.
“We regularly receive confidential information as part of our normal client relationships.
To breach a confidence or to use confidential information improperly or carelessly would be unthinkable.
“Our business is highly competitive, and we aggressively seek to expand our client relationships.
However, we must always be fair competitors and must never denigrate other firms.
“Integrity and honesty are at the heart of our business.
We expect our people to maintain high ethical standards in everything they do, both in their work for the firm and in their
personal lives”.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
The Consequences of Goldman’s Inauthentic and
Out-Of-Integrity actions
65
Goldman’s
reputation has suffered badly through the
unfavorable press it has received over the past several years,
including the Congressional hearings and charges by the SEC.
On July 15, 2010 the U.S. Securities and Exchange Commission
announced its settlement with Goldman Sachs as follows:
“Goldman Sachs to Pay Record $550 Million to Settle SEC
Charges Related to Subprime Mortgage CDO. Firm
Acknowledges CDO Marketing Materials Were Incomplete
and Should Have Revealed Paulson's Role”
See http://www.sec.gov/news/press/2010/2010-123.htm
Inauthentic and out-of-integrity behavior can be very costly, but
this payment was only part of the costs Goldman will incur for
this out-of-integrity incident.
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
In Summary:
Power, Freedom, and Full Self-Expression
The four foundational elements of leadership that we have
summarized:
— being authentic
— being cause in the matter
— being committed to something bigger than oneself
— being a person or organization of Integrity,
are each necessary (but not sufficient) for maximum
performance in our lives as human beings and in maximum
performance for our organizations
While each of these foundational elements are conceptually
independent, when all four are fully present in your life, you will
find extraordinary power, freedom, and full self-expression
In your Personal Life
In your life as a Leader, and
In your
Organization
© Copyright
2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782
References
Bill George. 2003. “Authentic Leadership: Rediscovering the
Secrets to Creating Lasting Value”. San Francisco: JosseyBass, page 11.
Securities and Exchange Commission, “Goldman Sachs to
Pay Record $550 Million to Settle SEC Charges Related to
Subprime Mortgage CDO: Firm Acknowledges CDO
Marketing Materials Were Incomplete and Should Have
Revealed Paulson's Role”, July 15, 2010.
http://www.sec.gov/news/press/2010/2010-123.htm
Shoda, Yuichi; Mischel, Walter; Peake, Philip K. (1990).
"Predicting Adolescent Cognitive and Self-Regulatory
Competencies from Preschool Delay of Gratification:
Identifying Diagnostic Conditions". Developmental
Psychology, 26 (6): 978–986
© Copyright 2010-2013. Werner Erhard, Michael Jensen, Vanto Group. All Rights Reserved.
Electronic copy available at: https://ssrn.com/abstract=2207782