Despite the fact, that there were more than enough supplies to deal with the situation. As a result, traders embraced the directives of Skilling and the company itself by overlooking the ethics of society and focusing on those of the organization. (Cline, 2011) ("Business Ethics," n.d., pg. 22) Clearly, a lack of morals and ethics at Enron contributed directly to the downfall of the company. The reason why, is because employees were pressured by managers to engage in actions that were considered to be unethical from the perspective of larger society. However, from the viewpoint of the culture of the organization, this was a part of helping the company to reach its different objectives. In the case of the California Energy crisis, these different factors played a major part in highlighting the lack of morals inside the company. Where, traders were encouraged to engage in actions that were directly against that of society at large, yet they supported the culture inside the organization. These different elements are important, because they are illustrating how this lack of focus on these areas played a major role in helping the company to be able...
At which point, the wholesale costs for electricity began to have a ripple effect on the costs that consumers and business were paying (which resulted in a number of blackouts). This is despite the fact that there was the potential to easily meet the demand of utility customers. Therefore, the situation is California is a microcosm of the underlying lack of ethics at Enron. This led directly to staff members engaging in immoral actions, as a culture was established to reward and support those who embraced these ideas.
Enron Case Study Enron was a company that started out small, but through some ethically unsound decisions, grew to control a large percentage of the energy market in America. In order to expand financially, Enron's executives skirted the law, creating several "independent" companies, called "special-purpose entities" (SPEs) into which they were able to hide many bad and devalued assets. In short, the executives used Enron money to create seemingly independent companies
People's confidence was put in question for such an important matter. It showed common people, who are not connected to everyday financial news the way in which money can be made through illicit means under the rules and regulations of the state and of the accountancy system. Moreover it broke the trust of investors, of employees, and of stock owners. This can have a long-term effect as investing companies
Enron was at one time considered to be a highly successful energy firm based out of Houston, Texas. The company was initially formed from a merger of two prominent gas pipeline companies in 1985, and the company's scope then broadened to include the provision of products and services in the realms of electricity, natural gas, and communications. Enron's reach expanded beyond the United States to the international market, as the
Enron hid most of its debts by establishing several LLPs, with some of them being secretly ran by Andrew Fastow, CFO at Enron. By counting only the gains and losses of the companies, but not having to report the LLPs on its financial sheet, Enron's financial position seemed very good. Consolidating the statements would have defeated the purpose of Fastow because the goal was to dump debt, not to report
Enron Leadership Enron collapsed very quickly in November 2001, and its failure should have been a warning to serious dysfunctions in the entire corporate and financial system, but this did not happen. Its executives admitted that they had falsified its records going back for at least five years, although in reality they had been doing so since the 1980s. When the company filed Chapter 11 bankruptcy it laid off over 20,000
If I was a legislator, I will be doing this act and I will not be swayed or affected by friends and lobbyists alike. Response to Ji Woo Chai: Indeed, the Sarbanes-Oxley Act was able to put in place controls and measures to prevent the reoccurrence of the Enron scandal. However, there has to be more done because of what occurred before and during the financial crisis. Thus, there may
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