Sign up

Financial Education Blog

Blog Author
Blog Month
The Importance of Integrity image

The Importance of Integrity

Do you show leadership or financial cancer?

In 1979, I learned an important lesson about the importance of integrity. At that time, my first business was failing. Many of our account receivables were out past 90 days, I owed money to our distributors and back taxes, and I was in danger of not being able to pay my employees.

Still, I was trying to hold on.

Rather than be honest with myself, I kept making excuses. And as rich dad said, “Excuses are simply lies you tell yourself.”

At this time, I sat down with rich dad and he looked over my books. After some tense silence, rich dad looked up, shook his head, and said, "Your company has financial cancer, and I'm afraid it's terminal. You boys have mismanaged what could have grown into a rich and powerful company.”

He went on to say, “You and the three clowns you call partners have mismanaged your business. You don't know what you're doing, you're incompetent. And worst of all, you don't have the guts to admit it. You guys are pretending to be businesspeople but when I look at your financials, you boys are either crooks or clowns. I hope you're clowns, but if you don't make some changes, you clowns will become crooks.”

It was a hard truth to hear, but thankfully I listened to my rich dad, liquidated my business, paid my employees and back taxes, and started over with nothing in my pocket. I wasn’t rich in terms of money, but I had gained a wealth of knowledge and retained my integrity, which is one of the most important things a person can have.

The Age of Integrity

One of the many lessons I learned from my failure was that it's not the lack of money that kills a business. It's more the lack of business experience and lack of personal integrity.

Around that time, I started learning from Dr. Buckminster Fuller, who was considered one of the smartest men of our age.

Dr. Fuller taught that we were entering the age of integrity. Integrity simply means whole or complete. That means that your thoughts, your words, and your actions need to be the same. If you will do that, the future is yours.

If you don’t, you can cause incredible damage in our increasingly connected world.

The power of integrity

This last week, the power of integrity was on display in a negative and massive way when Greg Smith, an executive at Goldman Sachs quit through an Op Ed in The New York Times.

According to Smith, “To put the problem in the simplest terms, the interests of the client continue to be sidelined in the way the firm operates and thinks about making money. Goldman Sachs is one of the world’s largest and most important investment banks and it is too integral to global finance to continue to act this way. The firm has veered so far from the place I joined right out of college that I can no longer in good conscience say that I identify with what it stands for.”

Central to what the firm used to stand for was “teamwork, integrity, a spirit of humility, and always doing right by our clients,” the “secret sauce” according to Smith that allowed the firm to enjoy success for over 143 years.

Living out of integrity

Among 14 values listed on Goldman Sachs website are two important ones:

OUR CLIENTS’ INTERESTS ALWAYS COME FIRST.

INTEGRITY AND HONESTY ARE AT THE HEART OF OUR BUSINESS.

Goldman has a problem today because a high level leader is questioning their integrity. They say one thing but do another. They live out of integrity.

As Smith writes,

How did we get here? The firm changed the way it thought about leadership. Leadership used to be about ideas, setting an example and doing the right thing. Today, if you make enough money for the firm (and are not currently an ax murderer) you will be promoted into a position of influence.

What are three quick ways to become a leader? a) Execute on the firm’s “axes,” which is Goldman-speak for persuading your clients to invest in the stocks or other products that we are trying to get rid of because they are not seen as having a lot of potential profit. b) “Hunt Elephants.” In English: get your clients — some of whom are sophisticated, and some of whom aren’t — to trade whatever will bring the biggest profit to Goldman. Call me old-fashioned, but I don’t like selling my clients a product that is wrong for them. c) Find yourself sitting in a seat where your job is to trade any illiquid, opaque product with a three-letter acronym.

Those actions couldn’t be more opposite than Goldman’s stated values.

How’s your integrity?

As I said, integrity is one of the most important things you can have and control. Each day, you make a decision whether you’ll walk in integrity or not. And in the Age of Integrity, our actions affect others in untold ways.

For instance, Goldman was a major contributor to the financial crisis because they pawned off toxic assets to clients, causing massive financial damage. Their lack of integrity cost investors billions if not trillions of dollars.

Conversely, Greg Smith’s open letter last week caused Goldman Sachs to lose $2.5 billion in market value.

Only time will tell how truthful Smith’s letter was, but I’m inclined to believe an individual who puts his reputation on the line over a firm that settles antitrust lawsuits with the SEC to the tune of $550 million and has a host of other public integrity issues.

But one thing remains true, the Smith/Goldman debacle shows that integrity is massively important in today’s world of business.

While your integrity or lack thereof may not cost people billions of dollars, it is still massively important to your success and the success of others.

A lack of integrity results in broken relationships, lost deals, and a bleak future. A life of integrity results in a multitude of friendships, new opportunities, and a bright future.

So, how’s your integrity?

For more information about building your leadership, integrity and success, see our free, financial education resources here.

Leave A Comment jump to leave a comment
xiaogongzhu
9/2/2012 11:47:22 PM
You may see right now several choice in addition to organic solutions true religion store to support those who withstand from difficulties in addition to migraines. In this post, Post print with regards to these kinds of cheap true religion jeans model of cures as well as propose that sorts of true religion jeans outlet meals persons must stay away from should they tend to be consistently suffering from headaches in addition to true religion jeans for men migraines.
prada
6/13/2012 7:08:19 PM

Christian Louboutin discount shoes helped bring stilettos back into fashion in the 1990s and 2000s, designing dozens of styles with heel heights of 120mm (4.72 inches) and higher. The designer's professed goal is to “make a woman look sexy, beautiful, Red Bottom Shoes Sale to make her legs look as long as [he] can "While he does offer some lower-heeled styles.QUT’s art museum is presenting Christian Louboutin Yolanda Patent Leather of the Lichtenstein’s works in an upcoming Roy Lichtenstein: http://www.louboutinshoesssale.com/ Pop Remix exhibition.

Most women may decide to buy away a lot of extras and is also an easy task to order Christian Louboutin Daffodile 160mm mbt dressmaker running shoes on-line developing and also the hardware the night excellent.cheap Red Bottoms Heels is a stylish as their footwear libraries are a emotion each summer.

carrier possesses its own personality because families.discount louboutins uk Kyeops Python Motorola clutch is related to with a noble lovely women silently take a position presently there, exuding sophistication plus expensive. It’s perfect natural covering is very comforting to view that you simply wouldn choose to take the eyes off from them. Few of delightful cheap louboutin shoes will help make your everyday living loaded with enchanting along with strength. It will not only enable you to have atisfaction of the perspective but also the psychic enjoyment.Choosing that clothing for your big event and even your best colleguerrrs marriage was not ever the following quicker.Currently!

prada
6/13/2012 7:12:20 PM

Edison brought from home a few moncler online Sale eggs inside of a neighbor found a secluded place, he was first setting up a nest within the bottom covered with soft grass, then eggs, gracefully, then sitting on best.Moncler Women Vests obtain the many abilities additionally to advantages of that technologies completely directly into bill when the rules within the additional design, textile style, colourings additionally to sizing’s additionally to types of http://www.cheapmonclerssale.com/ outdoor jackets.

New down jackets sold in short supply,Moncler women Coats, I recently learned in the creative industries of China Textile City base F5 Best costume design studio .To this, my father severely Cheap Moncler Long Down Jackets Outlet beat him up, and reported he was not allowed to engage in any future experiment. Using the constantly improving operating mode, the doorway of Moncler’s sport clothes was opened in 1994. Moncler Clothing have extended to many fields and also have increasingly more famous retailers in European region and also the world’s other countries from 1994 to 1998.

Just like you can see, this is a piece of Moncler down jackets, it is so unique for it’s design, right? Then now, if you also like this style of Moncler jacket and you can come in our store online to have a look. especially the orange and yellow ones Cheap Moncler Womens Pullover Sweaters is a legendary name for a company makes ski-wear Moncler finds his wide development space in cooperating with Junya Wsatanabe and Beams etc After developing their business for all these years.

prada
6/13/2012 7:17:21 PM

Prada has proposed two new eyewear design, 2011 FallWinter. Type 1 and type 2 Prada sunglasses are two color to choose, the use of a type also wearing dark glasses. Prada glasses retailers.We the hope that this is the Chur help or something from the access, because all the hair dye may lead to the Prada export most recent stage a bit hurt her hair.In1 of not so, child friendly discount Prada shoes, Lindsay Lohan and furry teeth host, Rico, spent some time.

Branded apparel has become a huge disaster victims, regardless of age group. Do not we all like it, when you get into a party and people ask you where to buy cheap Prada shoes on sale, the emergence of more and more brands, more and more people choose a brand. http://www.cheappradmenshoes.com/ Even known, we may be more willing to choose between brands of well-known brands and product prices, if there is not much difference. Why? Cooperation between the peoples of 21 solo and Oliver by Prada export production Prada sunglasses comparable figure the Persol out a personal dream-like sense of style.

When you fashion, there is no way you miss the Prada men shoes. It was founded in 1913 by founder Mario procession. He opened his first boutique in Milan, followed by his granddaughter in 1982 to expand the business level. She lazily first Prada British shoes.

prada
6/13/2012 7:28:51 PM

Love is really a moral quality. I really like a great autumn, love moncler. Within this autumn, what type of T-shirt are you going to select to demonstrate your beauty completely?The famous Moncler Branson Down Jacket has became the necessary item for many people in winter. The fashion designs and high quality is the main characteristics of the Moncler clothing. Another time, Edison saw the birds fly freely while in the sky, thinking Moncler women Jackets sale On the net Store, birds can fly, why cannot men and women fly?http://www.monclerdownjacketsssale.com/

Moncler jerkin available women, cheap moncler down jackets women for sale. Gombe state’s police commissioner had not been immediately available to discuss the violence. Moncler stands on the latest fashion again From this moment, women could enjoy the same right to pursuit fashion with moncler women jackets, as there have both Moncler mens Polo T-shirts and monkler mens down jackets for you to choose Moncler clothing never stop the steps of fashion clothing and the goal of moncler is to make out all kinds of clothes to all people.

Moncler men vests is frequently a prominent to have the ability to anyone which favors that foothills additionally to easy placed on. That Moncler items and solutions have grown to be famous around the globe, particularly cheap Monclers Outlet jackets.Moncler may well present several advantages.

chen
6/14/2012 10:32:56 PM
With cheap sunglassesprovide the ultimate in function but look incredibly stylish and perfect if you are seeking a pair of sunglasses which will really go the distance. Welcome to our cheap designer sunglassesonline sales shop, where you can always buy the most affordable price to a your favorite Cheap Oakley sunglasses provide the ultimate in function but look incredibly stylish and perfect if you are seeking a pair of sunglasses which will really go the distance. Welcome to our online sales shop, where you can always buy the most affordable price to a your favorite wholesale sunglasses.
chen
6/17/2012 10:58:22 PM
http://www.louisvuittonpursesbags.org/ Louis Vuitton Purses
http://www.louisvuittononlineshops.org/ Louis Vuitton Sale
http://www.officiallouisvuittonzone.net/ louis vuitton outlet
http://www.hermesoutletus.org/ hermes outlet
http://www.cheap-suprashoes.org/ supra shoe
http://www.louisvuittonusauks.co.uk/ louis vuitton purse
http://www.louisvuittonpurse-outlets.org/ louis vuitton purses
http://www.greatlouisvuittonbags.com/ louis vuitton outlet
louboutin565
6/24/2012 7:22:09 PM
http://www.cheapoakleysunglassesnew.com/Oakley Polarized Half Jacket Sunglasses Green
Anns
7/5/2012 7:15:28 PM
It's forty rolex watches six mm within dimension along with automated mechanised motion. Chopard Antique Off road racing Chronograph Modest Option For 1988, Chopard have become accepted timekeeper for those “Corsa più bella delete mondo?? all the Mille Miglia. While using brand-new Navitimer style pilots acquired quite a wonderful along with simple to operate guitar. Your BR01 is often a Minimal Format involving 500 bits. From Baselworld '08, Bell & Ross exposed a brand new multi-function BR Device view produced particularly using the France Atmosphere Pressure in your mind. The particular BR01 can be a Constrained Model regarding 500 parts. Navitimer 125e Anniversaire is usually a incredibly correct in addition to trusted check out.Its fouthy-six mm around dimension by using auto technical action. This jowl-bearing cheap replica watches head suggestions north america Airborne slogan “Death by Above??employed to tell fearless armed forces paratroopers in their electric power in addition to susceptability while in beat with Earth Struggle II, possesses due to the fact be a symbolic representation connected with braveness from the probability connected with demise.
Anns
7/5/2012 7:16:36 PM
That manufactured [url=http://www.bigrolexwatches.com/omega-watches-c-41.html]Omega Watches[/url] this Navitimer type optimally well-liked by authorities in addition to for this check out Breitling evolved into this “official service provider to help earth aviation?? This heightened in addition to reconditioned Navitimer that had been produced with confined version in '09 is this well known connected with model. One more fantastic originality regarding last year will be Huge Hammer The apple company together with 41 mm circumstance. All the option should are made up of 400 creations from each device. Any superstar product on this fresh assortment, the particular Vintage Race can be an ultra-powerful chronograph having an awe-inspiring forty-five mm-diameter circumstance. A fabulous music artist device in that cutting edge arranged, all the Antique Off road racing is really an ultra-powerful chronograph by impacting [url=http://www.bigrolexwatches.com/breitling-watches-c-16.html]Breitling Watches[/url] on forty mm-diameter lawsuit.Its fouthy-six mm around dimension by using auto technical action. A further superb novel idea with 2010 is definitely Significant Hammer Apple inc by using 41 mm instance. The outcome, bezel not to mention switch from Hublot Enormous Hammer Wally are prepared in your comparable color selection.
snapback
12/14/2012 7:27:19 PM
That's Snapback Hats the tough part of Snapback Hats Sale. But nevertheless NBA Snapback Hats I certainly am excited MLB Snapback Hats about having the opportunity to work NFL Snapback Hatswith some outstanding men in a great organization with outstanding Knit Hats people surrounding me.
Matt
3/21/2012 8:01:03 AM
I'm not positive if anyone stepped down from the large car manufacturers when they needed a bailout, but it didn't appear to happen. Unless I'm mistaken, not one seemed to acknowledge they mis-ran the company. To me, this showed a tremendous lack of integrity. Same goes with the big banks.
Team Honeywell
3/21/2012 12:35:53 PM
The Creature from Jekyll Island is a good book which explains things so even I can understand it. The word integrity seems to have been deleted from most if not all politics, big business and banking. We can only try to change our own worlds by changing ourselves first.
0

Play CASHFLOW Classic

Latest Rich Dad Blog Posts