If the people are governed by laws and punishment is used to maintain order, they will try to avoid the punishment but have no sense of shame. If they are governed by virtue and rules of propriety are used to maintain order, they will have a sense of shame and will become good as well.
The superior man will watch over himself when he is alone. He examines his heart that there may be nothing wrong there, and that he may have no cause of dissatisfaction with himself.