ENRON: HOW THE COMPANY GOT INTO TROUBLE

The Enron case was a daily staple of television news for several weeks in 2002. The story both started earlier and lasted longer in the print media. Now, however, one seldom hears about Enron or its top executives ù and the reason is not because they are all lodged safely in a federal prison. Rather, it because (a) the president and the congress gain no longer gain points by grandstanding on the issue, (b) the Department of Justice finds its difficult to put the top brass in the docket, although the Department has pressured some lower-level Enron executives into confessions, and (c) the public appears to be beyond caring.

The Enron scandal, however, was and is an important development for American society. The scandal demonstrated just how easily ethical standards can be discarded at the highest corporate levels when the price is right.

This paper examines the Enron scandal from a perspective of ethics in management. The phrase ethics in management in management is an unfortunate one. It implies that the set of ethical principles applicable in corporate management may be somewhat different from the application of ethical principles in other societal endeavors. Perceptions of that sort by top managers at Enron may have made it easier for them to pursue the courses of action that landed themselves and the company in the troubles that eventually emerged.

. . .
es in the trading of energy market was the manipulation of prices to created inflated and unwarranted profits for Enron at the expense of utility companies and utility consumers. Ultimately, however, the inflated profits contributed to the creation of a false representation of Enron's performance that created financial benefits Enron selected executives at the expense of investors and the public. Similarly, the immediate intent of deceptive accounting practices involving Enron and fictitious business entities was to shield from investor and governmental regulators the fact that Enron was not a profitable company as was being reported publicly. Additionally, however, the deals between the company and fictitious entities diverted large amounts of money from the company to selected high-level executives at Enron. These behaviors were injurious to Enron employees, investors, and consumers (Axtman & Scherer, 2002). One may attempt to assess the behaviors of the offending Enron executives (all at senior levels of the organization) within a framework of business ethics. The term "business ethics" appears to imply that behaviors that are ethically unacceptable in other facets of society may be acceptable in the business realm. W.
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Approximate Word count = 2459
Approximate Pages = 10 (250 words per page)

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