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Why Honesty and Integrity Really Do Matter Three powerful reasons why you should always do the right thing and never turn to the dark side.

By Steve Tobak Edited by Dan Bova

Opinions expressed by Entrepreneur contributors are their own.

It's OK to break the law. I've done it countless times, mostly when I was younger, but I still do occasionally. Don't sound so surprised; just about everyone does. I still speed, for example, but not nearly as much as I used to. It seems the older I get, the less I'm in a hurry to get where I'm going.

I once had a tax accountant who did some shady things. When I found out, I fired him. After all, if he's willing to defraud the government, why stop there. I simply didn't trust him. Besides, he was just a lousy accountant.

These days, my long-time personal and business accountant and I keep everything above board, and with good reason: When it comes to things that really matter – my family, career, and business – I play by the rules, and that's worked out pretty well, to say the least. But the reasons why are not as obvious as you'd think.

There's a big misconception about white-color crime. Everyone seems to think that executives and business leaders have recently lost their moral compass vis-à-vis Enron, WorldCom, Madoff, and all the other corporate scandals since the turn of the millennium, but that's simply not true. That stuff's been going on forever.

Most of my time as a senior executive and corporate officer of various public and private companies came before all that, and, let me tell you, there was no shortage of opportunities to stray. Insider trading, stock-option backdating, conflicts of interest, accounting fraud, financial fraud, antitrust violations, patent infringement, corporate corruption, cronyism – you name it, I've seen it up close and personal.

I've known quite a few otherwise honest people who, for whatever reason, were drawn to the dark side. I knew Raj Rajaratnam when he was an analyst at Needham. One day he told me he was quitting to run a hedge fund. Today, the billionaire Galleon Group co-founder is serving an 11-year prison term for insider trading, a scandal that ensnared executives and directors from IBM, Goldman Sachs, McKinsey, and Intel Capital.

Related: Can't Find a Job? Try This Instead.

The question is, why? Not why do successful people often fall into those traps? I think that angle's been beat to death. We're all so quick to judge others as evil and greedy when, given the chance, many of us would do the same thing. I think the more relevant and actionable question is why haven't I and, by extension, why shouldn't you?

I bet I know what most of you will say. It's about ethics. That may be true but it doesn't explain where those ethics come from. We're certainly not born with them. Needless to say, I've pondered this question for years and come up with three reasons. The first one is an emotional factor that relates to role models.

There were a series of episodes growing up where my dad – a strict disciplinarian with an unassailable work ethic – surprised the heck out of me by responding positively when I thought he'd go ballistic. I once confessed to stealing candy from a local shop and he commended me for being honest. And when I was accused of lying by another kid's father, he stood up for me, saying, "Steve may be a lot of things but he's not a liar."

Fast-forward a decade or so. I spent the first six years of my career as an engineer with Texas Instruments. My managers were all salt of the earth people who were incredibly generous with their time, especially when I was stuck or troubled by a tough dilemma. Their doors were always open, their advice genuine, and their manner encouraging, even when I screwed up.

When we face people we respect and admit to failure or confess to bad behavior, how they respond makes all the difference. When they show faith in us despite our issues, that resonates with us emotionally. It makes us want to earn their respect and deserve their faith. It sticks with us. And it shapes our behavior going forward.

Related: Are You a Real Entrepreneur or Just a Fake?

The logical factor is a very practical one: dishonesty is more trouble than it's worth.

Lying or stretching the truth is actually a real pain in the butt. Even exaggerations have a way of growing and taking on a life of their own. Before you know it, you're constantly looking over your shoulder and covering your tracks. It's exhausting. And, more importantly, it's a house of cards that eventually comes tumbling down.

Simply put, dishonesty is an inherently flawed and unsustainable model.

The third factor is karma. I'm not talking about karma that helps you in your next life; I'm talking about karma that helps you in this one. Try as we might to tell ourselves that we have good motives behind our bad behavior, on a subconscious level, we always know what we've done. And it plagues us.

If, on the other hand, we're so delusional and adept at compartmentalization that we don't have to face the truth about what we've done, trust me when I tell you, that's no picnic either. Either way, I'm pretty sure that people who do bad things live in their own personal hell.

To summarize, there are three reasons why you should always play it straight:

  1. To earn the respect of those you respect.
  2. Dishonesty is inherently flawed and unsustainable.
  3. What goes around really does come around.

Related: Why Politics and Business Don't Mix

Steve Tobak

Author of Real Leaders Don't Follow

Steve Tobak is a management consultant, columnist, former senior executive, and author of Real Leaders Don’t Follow: Being Extraordinary in the Age of the Entrepreneur (Entrepreneur Press, October 2015). Tobak runs Silicon Valley-based Invisor Consulting and blogs at stevetobak.com, where you can contact him and learn more.

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