Since The Economics of Integrity came out at the end of February, three huge corporate stories have unfolded, illustrating the phenomenal importance of integrity to a company’s bottom line. Toyota, Goldman Sachs and BP are great examples of what happens when a company’s integrity is called into question. For public companies the market reaction to an integrity breach is swift and the stock is punished. Longer term, though, the costs will also pile up. Think of what faces BP in the future: a bill for damages, the likelihood of more restrictive regulations around the world, less trust from business partners and so on. But it doesn’t have to be like that. If corporations understand the importance of integrity to their bottom line they can learn to protect and promote their most valuable asset. Here are five critical steps to investing in corporate integrity:
1. Keep your promise. Start with your brand since this is your promise to customers. If you promise quality as part of your brand, then make sure you do everything you can to deliver quality. If it’s safety, deliver safety.
2. Make it a win/win for everyone. Make sure what you do benefits everyone involved: shareholders, customers, employees, suppliers and society. If you’re doing anything destructive, stop immediately.
3. Reliability. Go the extra mile to be reliable. Do not cut corners however tempting it may be.
4. Continuous improvement. Focus on how to make the experience and product better for everyone.
5. Feedback. Seek out constant feedback from your employees, customers, suppliers and so on. It’s valuable information to help improve and address problems as they arise.