Integrity outline

Questions:

1. What does Lynne McFall claim to be formally required of a person of integrity?
   1. Coherence, Moral integrity (personal & social), Identity-conferring commitment
   2. My opinion is that integrity requires holding to your principles in the face of temptation and conflict. It requires “doing the hard thing”, not taking the easier path. But you need conflict, therefore wealth and pleasure don’t qualify as personal principles for integrity.
2. Why is it important for a business leader to be a person of integrity?
   1. Get buy-in from employees and foster passion and creativity
   2. Bowie case studies of kantian ethics
      1. Servant leadership
      2. Transformational leadership
      3. Jan Carlzon, SAS airlines. Empowered people to make their own decisions and saved the company.
      4. ABB’s Relays Business
      5. Tylenol poisoning, compare to pharmaceutical company
   3. Lead by example
3. In your view, are there any meaningful constraints on the principles that should govern and orient a “good” business leader?
   1. The business should not become more important than the people in it. A business that hoards wealth is taking money out of the economy from people’s wallets.
   2. A business leader should not allow the business to exploit customers, other businesses, the government, the legal system, or the tax system.
      1. The defence that the company is still “in compliance with all relevant laws” is not good enough if it’s still causing harm to others or society.
   3. There are times when a business should fight the government, and times when they should comply instead of resist.
      1. ex. Apple fighting the FBI encryption backdoor order
      2. ex. Apple fighting against USB-C standardization, Google & Facebook fighting the canadian news law and removing canadian news sources from their site.
4. Select a topic that was raised in Units 5 to 7 to help defend your response.
   1. Market failures theory, unit 6
   2. Heath (2014)

Ideas:

• People are what matter, not businesses. Businesses are not people. Business decisions should put people first, as businesses have no reason to exist without people.
• I don’t agree with the idea of business incorporation; that they should have the same legal status as people.
• Example: Business leadership being secretive about an upcoming layoff and surprising all their employees with it, rather than just letting everybody know what’s going on well ahead of time so they can prepare.
• Choices that negatively impact the business are only bad because they negatively impact the people working there. Many business impacts eventually impact people because it leads to the early decline or extinction of the business, which in turn reduces the income of the people employed there.
  • Unless of course they go work somewhere else, which the business should never try to interfere with. e.g. Hiding salary info or making it taboo to talk about, forcing game devs to use fake names in the credits of their games so other companies won’t try to recruit them (find japan source).
  • When a business dies it goes through a package bankruptcy. The employees don’t lose their jobs, just the owners and shareholders lose value.
  • The impact to executives vs frontline workers would be judged by the normal basis of morality e.g. utilitarianism

Thesis: A business leader should be a person of integrity because their actions have an impact on society.

Draft

Introduction

In the 1970s, Nestlé began an advertising campaign to sell its infant formula in Asia, Africa, and Latin America. Saleswomen dressed in nurses’ uniforms visited new mothers to convince them that infant formula was better for their baby than breastmilk (Krasny, 2012). They provided the infant formula to mothers for free while in the hospital, who would use it to feed their newborn rather than breastfeed. Once they left the hospital however, the mothers would find that they were no longer producing milk because they had stopped breastfeeding early, and were now forced to purchase the infant formula to continue feeding their newborn (International Baby Food Action Network, n.d.). In these impoverished nations, mothers struggled to afford the formula and often diluted it with water. Millions of infants died or developed malnutrition while Nestlé earned billions in revenue (O’Sullivan, 2023). Consumer boycotts over Nestlé’s unethical business practices started in 1977 and are still ongoing today (Boycott Lists, 2024).

Corporations have a lot of power in our world. Large multi-national companies such as Nestlé have to potential to harm millions of people through its actions. When business leaders put profits above all else, there are real-world consequences. Business leaders must keep this in mind when making business decisions. It is the responsibility of business leaders to act with integrity because their actions have an impact on society.

Body 1 - integrity requirements

Lynne McFall (1987) claims there are three aspects of integrity: coherence, moral integrity (personal & social), and identity-conferring commitment.

The first aspect of integrity, coherence, is about matching your actions to your principles. If a man is committed to telling the truth no matter what, but then lies to his spouse about what he really thinks of her friends, he is not acting in coherence with his principles and therefore is not acting with integrity. Coherence addresses the aspect of integrity which could be summed up as “sticking to your guns”. Antithetical to this quality is someone who never acts in accordance to their principles, or sometimes does and sometimes doesn’t.

The second aspect of integrity is that of importance. The principle that can be used to confer integrity are only the moral ones. One cannot make the attainment of pleasure or wealth their guiding principle. Someone who always chooses the path of least resistance may be coherent, but they are not moral, and therefore are not a person of integrity.

The third aspect of integrity is an identity-conferring commitment. You must be committed to your principles; they need to be part of who you are. Someone who changes their principles too much is not a person of integrity, even if they’re changing from one good principle to another good principle and pursue each with full force during its turn.

Someone who embodies all three aspects can be said to be a person of integrity.

Body 2 - importance of integrity

Acting with integrity is important for a business leader because laws and regulations are insufficient at constraining a company’s behaviour, and because it increases profitability.

Society relies on corporations acting fairly because laws and regulations are insufficient at constraining a company’s behaviour to only ethical actions. The Panama Papers scandal revealed that Apple, after dodging the 2013 crackdown on its use of Irish tax havens, was storing more than $230 billion US in another tax haven in the Channel Island of Jersey (CBC Radio, 2017). Apple has shown that it is capable of finding new tax loopholes faster than governments can close them.

[Maybe add a part about stockholder theory and a counter to it] [ Stockholder theory says, “don’t try to be help ethics with other people’s money”, and I say, “don’t do bad things with other people’s money either. It’s not like they’re paying you to be unethical as part of your contract.”]

Acting with integrity also directly impacts business profitability. As an example, recall the famous Chicago Tylenol Murders of 1982, where seven people died after taking Tylenol that had been poisoned with cyanide (Byars & Stanberry, 2018). The CEO of Johnson & Johnson was faced with an ethical dilemma. They had three options: 1. They could choose not to recall the product because the criminal was entirely responsible and it wasn’t legally required (Siedel & Ladwig, 2020). 2. They could choose to recall only the bottles from the city where the murders happened. 3. They could recall all bottles worldwide at tremendous cost. The company lawyer advised against a recall because it could look like an admission of fault (Siedel & Ladwig, 2020). The CEO chose to the third option, citing the corporate values of consumer safety, which cost the company over $100 million (Bryars & Stanberry, 2018). When the company eventually returned to the market they introduced tamper-proof containers and became a leader in consumer drug safety. Their market share, which had initially plunged from 37 percent to 7 percent after the poisonings, rose back up to 30 percent the following year (Bryars & Stanberry, 2018). By acting with integrity in a crisis, Johnson & Johnson earned back public trust and their earnings rebounded. Had they not taken such a strong ethical stance that put consumer safety over profits, it’s likely that their brand would have been forever damaged.

A business leader plays a role in society, and they have obligations to society that must be respected, or they will lose public trust.

Body 3 - a “good” business leader

A business should not put profits above social good.

Businesses are justified in seeking profits only because it also benefits society. In his essay, “Business Ethics Without Stakeholders” Heath (2006) argues that “the point of permitting profit-maximizing behavior among firms in the first place is to promote price competition, along with all the beneficial “upstream” and “downstream” effects of such competition, such as technical innovation, quality improvement, etc.” (p. 549). When a business leader makes a decision that increases profits but harms society, they are undermining the foundation of that business’s existence.

A business leader should not allow the business to exploit customers, other businesses, the government, the legal system, or the tax system. Heath (2006) argues that “the law is a somewhat blunt instrument” (p. 550) because of its inefficiencies or its inaccuracies. The state carries the burden of obtaining the relevant information (sometimes from parties that know it will be used against them), and enforcing compliance, both of which come with their own difficulties. Heath uses the term “market failure” to describe when a company is able to profit using competitive strategies that do not benefit society. According to Heath’s market failure model, companies must exercise ethical restraint against using these kinds of competitive strategies because they may harm society but cannot be entirely prevented through legal regulation.

Business leaders should have a shared code of ethics like doctors, engineers, and lawyers do. Heath (2006) argues “the mere fact that managers do not belong to professional associations does not mean that they are not professionals, or more importantly, that there is not a distinctive set of ethical obligations that arise out of their occupational role. The fact that they are in a position of trust is what matters.” (p. 537, para. 2). Like doctors, engineers, and lawyers, establishing a professional code of ethics will make business leaders more reputable and trustworthy.

An ethical business leader is mindful of the business’s ability to harm society.

Conclusion

Businesses shape almost every aspect of modern life, and when a business acts unethically it can negatively impact millions of people. In this essay I described the three requirements of integrity, why laws and regulations are not sufficient at enforcing ethical behaviour, and how integrity should constrain business decisions. New leadership models have emerged which emphasize integrity and ethical business leadership. One such model is the B Corp movement, which aims to balance purpose and profit (About B corps, 2025). As consumer awareness grows and consumers start demanding more ethical behaviour from companies, business leaders must embrace the ethical responsibilities of their position.

References

Latson, J. 2014. How Poisoned Tylenol Became a Crisis-Management Teaching Model. https://time.com/3423136/tylenol-deaths-1982/

Byars, S. M., & Stanberry, K. (2018). The Chicago Tylenol Murders. In Business Ethics. OpenStax. https://openstax.org/books/business-ethics/pages/3-2-weighing-stakeholder-claims

Siedel, G. & Ladwig C. (2020, July). Ethical dilemma: The burger murders [Video]. TED. https://www.ted.com/talks/george_siedel_and_christine_ladwig_ethical_dilemma_the_burger_murders

Heath, J. (2006). Business Ethics without Stakeholders. Business Ethics Quarterly, 16(4), 533–557. http://www.jstor.org/stable/3857795

CBC Radio. (2017, November 10). How Apple managed to pay almost no tax on billions in Profits. CBCnews. https://www.cbc.ca/radio/day6/episode-363-apple-s-tax-shelters-marvel-vs-dc-london-s-wartime-stretcher-fences-lost-jewish-music-more-1.4391482/how-apple-managed-to-pay-almost-no-tax-on-billions-in-profits-1.4391505

About B corps. B Lab U.S. & Canada. (2025). https://usca.bcorporation.net/about-b-corps/

Nestlé Boycott. Boycott Lists. (2024, September 28). https://boycottlists.com/nestle-boycott/

Krasny, J. (2012, June 25). Every parent should know the scandalous history of infant formula. Business Insider. https://www.businessinsider.com/nestles-infant-formula-scandal-2012-6#war-on-want-said-this-undermined-womens-confidence-in-breastfeeding-6

International Baby Food Action Network. (n.d.). How breastfeeding is undermined. https://web.archive.org/web/20070415171525/http://www.ibfan.org/english/issue/bfUndermined01.html

O’Sullivan, L. (2023, July 24). Crime & Controversy: Nestle’s 5 biggest scandals explained. Utopia. https://utopia.org/guide/crime-controversy-nestles-5-biggest-scandals-explained/