Premium Essay

Enron Ethical Issue

In: Business and Management

Submitted By braveheartwang
Words 1074
Pages 5
September 22, 2014
Ethical Meltdown This case describes one of the biggest corporate collapses due to unethical practices in the history of the United States. Before the ethical meltdown, Enron was the world’s largest wholesaler of natural gas and electricity. In a competitive market, companies are constantly struggling to improve their services or products in order to gain a competitive advantage. The pressure to succeed sometimes allows for companies to forget their morals and participate in unethical practices. “It turned out that the lack of accounting transparency enabled the company’s managers to make Enron’s financial performance look much better than it actually was” (Dessler, 2013, p. 242). As a result, several top executives were convicted of manipulating Enron’s profit statements and investors lost most of their investments in Enron. This is a perfect example of a company that lacks professional ethics and proper management. Enron was able to succeed and become a huge corporation in the United States economy. However, the loss of morality and ethics eventually led to the collapse of the corporation. In order for a company to become successful and maintain their success a proper ethical culture is needed within the organization.
Enron’s Ethical Culture Dessler describes ethics as, “the principles of conduct governing an individual or a group and specifically to the standards you use to decide what your conduct should be” (2013, 240). In order for a company to be successful a code of ethics must be applied to the company’s culture. The behavior of both Enron’s CEO and the employees when an analyst asked about the firm’s suspicious accounting statements is an example of the company’s lack of proper ethical culture. The incident consisted of the CEO describing the analyst using inappropriate language while the employees laughed. There is no proof that…...

Similar Documents

Premium Essay

Ethical Issues

...Ethical Issues Pamela Funsch Ethics/316 November 5, 2012 Terry Burr Ethical Issues In this paper many questions will be answered. Upon completion of the simulation the ethical issues will be discussed and the decision-making steps taken to address ethical issues? What ethical perspectives, or lenses, were used to make the decisions in the simulation? How may concepts from this simulation relate to the workplace? In the Mysterious Blogger the issue to be addressed was the situation, including Jamal Moore and Aaron Webb should be addressed. The details included information from the company that had been made public information by Aaron Webb. Jamal Moore was the employee who picked up on this information and reported it to the company. ...

Words: 835 - Pages: 4

Premium Essay

Ethical Issues

...Management Ethical Issues in Management Ethical Issues in Management The tasks of a supervisor go far beyond management. In fact, supervisors have to make vital decisions all the time that affect their employees, and possibly the business depending on the situation. Managers take part in hiring, performance, evaluation, discipline, and termination. They are also involved in any circumstance that pertains to harassment and diversity, and they must make a conscious effort to set a good example for their employees. The following paper will focus primarily on termination; describe the moral and ethical issues faced by managers dealing with termination; explain how relationships between social issues and ethically responsible management practices apply to termination; provide a workplace example of an ethical dilemma involving termination. Termination In the case of termination, performance evaluations, verbal and written warnings can be moral issues as they all entail truthfulness, evenhandedness, and the self-respect of the individual. Managers play a critical role in increasing engagement and building an ethical way of life for the most part sensible issues of company ethics. We need not determine all the rational disputes involving the utilitarian’s and the deontologists. Regardless of the different approaches, in the bulk of situations both techniques, if cautiously, delicately, and carefully applied, will generate the same ethical conclusion......

Words: 433 - Pages: 2

Premium Essay

Ethical Issues

...Ethical Issues Ethics: The Hallmark of Leaders at All Levels Abstract The intent of the paper is educating people about the abuse of power. Why a code of conduct is necessary for a company to be successful. Examples of what can go wrong in certain situations when bad moral judgment is used for personal gain. How to correct violations with a new code of ethics and compliance officer to ensure these the code of ethics will be followed. 1. Table of Contents 1. Intro into a problem in the workplace page 4 2. A code of conduct page 5-6 3. Professional conduct page 7 4. Code of conduct in the workplace 5. Where to and how to implement the code of conduct page 7 6. The conclusion and solutions for unethical and moral character page 7 7. How the code of ethics you developed can be applied to deal with page 8 Your chosen ethical issue 8. How the character, values, and integrity of a leader can aid in Making your proposed code of ethics more than just another document that employees acknowledge when they are hired, but instead make it a valued part of their everyday work lives for your fictional business page 9 Ethical Issues Identify and clearly describe an ethical issue. The ethical issue I will discuss is bribery in the work place; an inspector took a bribe to allow a property owner to break city code while building a......

Words: 2020 - Pages: 9

Premium Essay

Ethical Issues

...PD225 Applied Ethic Describe Ethical Dilemma An ethical dilemma can be referred to anything that happens or you do but you know it’s wrong. For an example: “Bringing a person back to life after an apparent death or in cases of impending death- Typically, a family wants to keep their loved one alive no matter what, but there are instances when the family wants to terminate treatment when a physician thinks it's premature to do so. Therefore “If the patient had a reasonable chance to recover, I would get an ethics committee’s opinion or ask the family to find another physician if they wish to terminate care” says, Dr. Prager. In this case, how should you ethically act in this situation? The only ethical way to deal with it is to report the scenario to the supervisor or the manager, before anything comes out of it to and affect you. The employee knows, so well, that what she did is unethical, and if she does take the money out for the dormant account and you know about it, then you are part of it. Therefore you should act first for your own good –report it! Another, way to solve unethical behavior in the working environment, is to talk to the person that has the issue and let him or her know what you can do to help. In my perspective for an unclear dilemma with an employee, is always do the right ethical thing. Employees sometimes find themselves in an unprofessional situation, caused by the lack of communication with the supervisor, and other employees. They......

Words: 1196 - Pages: 5

Premium Essay

Ethical Theories Applied to Enron

...Prescriptive Approaches to Ethics at Enron Enron was a global energy firm that filed for bankruptcy protection in 2001. The firm’s senior managers had engaged in fraud for an extended period through a scheme in which partnerships owned by the managers could receive payment for goods and services never provided to Enron. In addition, the firm’s external auditing firm, Arthur Andersen, was complicit in the fraud by knowingly certifying false financial statements as accurate. Arthur Anderson participated in the fraud because the firm did not want to risk losing lucrative consulting contracts from Enron, which created a conflict of interest situation (Miller, 2004). The events leading to the collapse of Enron can be analyzed using the ethical frameworks suggested by consequentialist theory, deontological theory, and virtue ethics. Such an analysis can provide an explanation of the failure of Enron’s directors, mangers, and auditors to adhere to their ethical duties to the shareholders, employees, customers and suppliers of the firm. Consequentialist theory suggests that an act is ethically wrong if it results in consequences deemed wrong or harmful by the majority of people in a society (Hooker, 2002). The consequentialist theory requires assessing the actual consequences of the act, which includes both direct and indirect consequences. It also requires using some type of evaluative norm for determining whether the consequence is beneficial or harmful. The theory is......

Words: 1705 - Pages: 7

Premium Essay

Ethical Issues

...Ethics Issues University of Phoenix MGT 216 Organizational Ethics and Social Responsibility 20th July, 2009 Ethics Issues Less than a year ago a regional property supervisor working for California Commercial Investment found an accountant stealing from the company. More specifically, the accountant was posting charges for one of our buildings (i.e. labor and supplies for painting), cutting checks, misleading the owner to sign them and cashing them for himself. He was able to steal a few thousand dollars with his unethical behavior before being caught by the property supervisor. Unethical behaviors like the one previously described are not uncommon in today’s business world. Indeed, workers during the course of their careers can face several ethical issues; therefore, understanding what business ethics is and how to deal with ethics issues can increase the chances to take appropriate actions when ethics issues occur. Bateman & Snell (2008) stated that business ethics “comprises the moral principles and standards that guide in the world business” (p. 181). In today’s business world, every organization has a legal responsibility to obey local, federal, state, and international laws. Further, every organization has an ethical responsibility which means meeting social expectations that are not translated in laws. Finally, every organization has a corporate social responsibility which is “the obligation toward society assumed by business. The socially responsible business......

Words: 1144 - Pages: 5

Premium Essay

Ethical Issues

...advertising and promotion) overlap with media ethics. Contents 1 Fundamental issues in the ethics of marketing 1.1 Frameworks of analysis for marketing Possible frameworks 1.2 Power-based analysis 1.3 Is marketing inherently evil? 2 Specific issues in marketing ethics 2.1 Market research 2.2 Market audience 2.3 Pricing ethics 2.4 Ethics in advertising and promotion 2.4.1 Content 2.4.2 Delivery channels 2.4.3 Deceptive Advertising and Ethics 2.5 The use of ethics as a marketing tactic 2.6 Neuromarketing ethics 2.7 Marketing strategy 2.8 Further issues in marketing ethics 3 Regulation and enforcement 4 See also 5 References 6 Bibliography 7 External links Fundamental issues in the ethics of marketing[edit] Frameworks of analysis for marketing Possible frameworks[edit] Value-oriented framework, analyzing ethical problems on the basis of the values which they infringe (e.g. honesty, autonomy, privacy, transparency). An example of such an approach is the AMA Statement of Ethics.[1] Stakeholder-oriented framework, analyzing ethical problems on the basis of whom they affect (e.g. consumers, competitors, society as a whole). Process-oriented framework, analyzing ethical problems in terms of the categories used by marketing specialists (e.g. research, price, promotion, placement). None of these frameworks allows, by itself, a convenient and complete categorization of the great variety of issues in marketing ethics Power-based analysis[edit] Contrary......

Words: 3041 - Pages: 13

Free Essay

Ethical Issue

...| Business Ethics | Ethical Issue: Nepotism in workplace | | | | | | Table of Contents Ethical Issue: Nepotism in the Workplace 1 Reference 2 Ethical Issue: Nepotism in the Workplace An ethical issue according to business dictionary. com, can be defined as “a problem or situation that requires a person or organization to choose between alternatives that must be evaluated as right (ethical) or wrong (unethical)”. There are many ethical issues facing the workplace today that can be evident. One observed is that of Nepotism, Nepotism is the practice where those with power or influence favor relatives or friends, especially by giving them jobs. The word “Nepotism” comes from the Italian word “nipote” which means ‘nephew’. It is referenced to privileges bestowed on the “nephews” of popes, who were in many cases their illegitimate sons. Nepotism in the workplace is common since it is a practice that does not have any universal law attached to it. It will be difficult to prove that nepotism does in fact occur in any organization; but, based on the link between persons hired and their relations, suspicions of the occurrences can be brought up. Nepotism is seen both in the private and public sector. Based on research, it is more prevalent in the public. Perez-Gonzalez (2006), using data from the chief executive officer (CEO) successions of publicly traded U.S. corporations, calculates that 36.4 percent of these firm’s CEO successions involved......

Words: 991 - Pages: 4

Premium Essay

Ethical Issues

...Discuss various ethical issues that would be likely to have bearing upon company commercial relations with suppliers Ethical Issues With diverse gatherings included in the inventory network handle there is dependably an issue of who is in effect reasonable and overall. Pressures emerge in inventory network primarily because of the apparent comprehension of 'reasonable play' between different gatherings. What may appear to be as a true blue course of completing the business may be seen as an unreasonable exchange hone by the other. So underneath are a portion of the moral issues confronted by the gatherings included in the inventory network process. Producers There are various moral issues that a maker could conceivably confront in a store network process. Working conditions, work rates, youngster work, environment disagreeable works on (counting creation of merchandise and transfer of squanders), use of characteristic assets are a percentage of the elements in which an association can go amiss from its reasonable business hones. A few associations with the support of the administration in their country resort to abuse of the accessible assets either by misusing the political unsteadiness or by nourishing the degenerate officials of the host country. These activities make a feeling of disappointment among the workforce in the more extended run which may bring about disturbance in the generation process. Likewise ecological debasement can't be discounted if the association......

Words: 1621 - Pages: 7

Premium Essay

Ethical Issues

...●● learning OBJECTIVES After studying Chapter 3, you will be able to: LO1 LO2 Explain how companies influence their ethics environment. LO3 Outline a process for making ethical decisions. LO4 Summarize the important issues surrounding corporate social responsibility. LO5 Discuss reasons for businesses’ growing interest in the natural environment. LO6 bat37233_ch03_050-071.indd 51 Describe how different ethical perspectives guide decision making. Identify actions managers can take to manage with the environment in mind. 11/11/09 11:01:16 AM Confirming Pages ● ETHICS The system of rules that governs the ordering of values. This chapter addresses the values and manner of doing business adopted by managers as they carry out their corporate and business strategies. In particular, we will explore ways of applying ethics, the system of rules that governs the ordering of values. We do so based on the premise that managers, their organizations, and their communities thrive over the long term when the managers apply ethical standards that direct them to act with integrity. In addition, we consider the idea that organizations may have a responsibility to meet social obligations beyond earning profits within legal and ethical constraints. As you study this chapter, consider what kind of manager you want to be. What reputation do you hope to have? How would you like others to describe your behavior as a......

Words: 15103 - Pages: 61

Premium Essay

Ethical Issues

...Software Development 2010 Ethical Issues in Information Technology There are a great variety of ethical issues in I.T.: 1 Ethical dilemmas There are various ethical dilemmas in relation to I.T. that need to be addressed. What are and are not ethical issues in I.T.? In regard to hackers, for example, are they testing the system or performing an immoral action? Will genetic engineering improve the quality of peoples’ lives or start to destroy it? How do we recognise when an ethical dilemma exists? There are, indeed, many grey ethical areas. 2 Plagiarism Plagiarism is where the work of others is copied, but the author presents it as his or her own work. This is a highly unethical practice, but happens quite frequently, and with all the information that is now available on the Internet it is much easier to do and is happening more often. 3 Piracy Piracy, the illegal copying of software, is a very serious problem, and it is estimated that approximately 50% of all programs on PCs are pirated copies. Programmers spend hours and hours designing programs, using elaborate code, and surely need to be protected. Although some might argue that some pirating at least should be permitted as it can help to lead to a more computer literate population. But, for corporations, in particular, this is a very serious issue, and can significantly damage profit margins. 4 Hacking Hackers break into, or ‘hack’ into a system. Hacking can be undertaken for a variety of reasons, such as the wish to......

Words: 2051 - Pages: 9

Premium Essay

Ethical Issues

...Ethical Issues Ethical Issues in Corporate America Larry Goodman Business 610/ Organizational Behavior Prakash Menon April 10, 2011 Ethical Issues 1 The purpose of this paper is to look at the Ethical Issues in Corporate America. This paper will address areas regarding why ethical issues are a major concern in organizations, what influences impact ethical behavior and how organizations can influence ethical behavior in employees. To complete this task outside resources, such as books and articles will be utilized. According to Wise Geek.com, Ethic is defined as, “the behavior that a business adheres to in its daily dealings with the world”. Ethic takes on many different forms with any organization, how ethics impacts employees is very important to the success and failure of the company. Organizations are more likely to achieve ethical success with the employees if the employees are properly trained to complete any desired task. Given the fact that the employees are not trained properly, makes them more likely to make a mistake or incapable of performing job duties, this is a condition that will influence the ethical behavior of the employee. Properly continued training will enable the employees an opportunity achieve better results and it will help the organization produce better products. The employer may utilize other areas to help drive desired ethical behavior. The employer may take steps to help increase the desired ethical behavior. The employer may use...

Words: 660 - Pages: 3

Premium Essay

Ethical Issues

...ETHICAL 1 Ethical Issues Organizational Behavior/BUS610 April 30, 2012 ETHICAL 2 An ethical decision is made up of moral issues and choices. The choices a person makes are ones he or she has to live with despite the moral implications or consequences. There are several reasons that a person decides whether they will choose the positive or negative way. These different ways will be discussed in this paper. The best way to influence positive ethical decision making is to be a positive influence. The Sarbanes-Oxley Act of 2002 was established with harsh penalties and higher accountability standards. Criminal Acts from the CEO’s from Enron, WorldCom, Tyco, Aldelphia Communications and Computer Associates along with several other executives have led to imprisonment for them all for unethical decisions that were made (Kinicki, Kreitner, 2009). No one is immune to unethical decision making. Making an unethical decision can cost a corporation or organization profits. It is estimated that $600 billion a year is lost in United States Companies from criminal behavior and unethical decisions (Kinicki, Kreitner 2009). The more ethical a corporation is the better chance it has to hire the best employees. I do not think anyone wants to start out by saying; I work for an unethical company. Ethical conduct is influenced by several factors, with the......

Words: 757 - Pages: 4

Free Essay

Ethical Issue

...In our recent lectures, we discussed numerous ethical foundations that exhibit day to day life and its meaning. Christianity ethics is the ethical foundation that I most discussed in the previous paper. The reason I stressed this ethical issue is because I feel it can be implemented by many in all career and success. My future career is in psychology, which is a field that deal majority with behavior. The ethical issue that would most likely happen in my career is a confidentiality breech. If and when I am a psychologist I will deal with a lot of confidential information with my clients/patients. I'm sure there will be a time when I am accused of leaking this information to others, betraying my clients/patients privacy. How is it that my ethical foundation can be used to solve such a situation? Christianity ethics are base solely on morals. In my previous paper I discussed the good in the higher power, such as God, that we believe in. In order to resolve the issue with confidentiality I would start with morals. Most Christians use prayer as well. Within prayer, we feel that if we call on a higher being such as God, all conflicts will be resolved; not when we want them to, but right on time. The Holy Bible is like a guide for the ethical foundation in which I practice. It gives regulations of a holy life; if you follow these regulations then you are liable to live a structured, successful life. Therefore I would use prayer and the structure given from the Bible. ...

Words: 655 - Pages: 3

Premium Essay

Ethical Issues

...Why are ethical issues a major concern in organization? When it comes to ethics I believe that it starts with ones morals, although morals are based on one beliefs and ethics is based on a code of conduct I believe you don’t have one without the other. So within any organization I believe that their goals is to insure that things are some right by ensure that the companies code of conduct is being consider when needed and applied. In our text on page 23 the authors does a great job of explaining ethics. They “say that ethics involves the study of moral issues and choices. It is concerned with right verse wrong, good verse bad and the many shades of gray in supposedly black and white issues.” Moral and ethical issues are in every one life on a daily bases, whether they are on the job or in their personal life. ((KInicki & Kreitner, 2009) I feel that it’s very important that a manager makes the right decision within an organization. If unethical behavior or code of conduct is present within an organization employees may feel that behavior is welcome and awarded. Subordinated would than lose respect for upper management within the organization. What individual influences impact ethical behavior? In our text the author teaches about the model of individual ethical behaviors and how a person has a unique set of personality characteristics, values, moral principles, history of reinforcement, and gender; meaning that people whom feel that they have higher morals tend......

Words: 712 - Pages: 3

Eureka Seven: New Order | IMDb: 8 ? HD Won't You Be My Neighbor? | 1x39 SuperCampeones 2018