*Edit: I checked some of the stuff more out in detail. While some concepts on this are valid and backed up by sience, others like RSD are not. Use this as a springboard for learning, not as a valid source in itself. Yes it says so in the corner already. But spelling it out might help.
People are more complicated then a diagram from the internet. Never forget that.
You're probably right -- but let's pick that apart for a bit. What you are basically describing is "doing what's right when nobody is watching." How is that not a "superior code of conduct," as you put it?
Social codes don't have inherent value. They vary over time, places, culture, etc...
Right and wrong are subjective. You can try to debate for moral absolutism, but I won't respond.
I was describing "doing what one thinks is expected to be the right choice as defined by code without incentives to do so other than the personal desire to uphold the code by making the choice it suggests"
Maybe: More closely adhere to whatever their morals may be. Good, bad, or otherwise.