Decision Making at Enron

There is enough blame to go around concerning Enron's collapse. The major cause was deception on the part of its executives, and compliance by both Enron's auditors, Arthur Andersen, and its various legal staffs and outside consultants who "approved" the activities of Enron's house of cards. "The Enron case is a dream for academics who conduct research and teach, For those currently or formerly involved with the company, such as creditors, auditors, the SEC, and accounting regulators, it is a nightmare that will continue for a long time" (Thomas 2002 41).

The Enron mess is perhaps the greatest failure of human resources and employee-management relations in the history of American industry. Even when the stock began to sink, Enron employees were not permitted to take any of the stock out of their 401Ks and other retirement plans which were vested in Enron stock. Kenneth Lay, Enron's chief executive and others sold millions of dollars' worth of their stock. The employees could not do so. Worse, the employees were constantly lied to.. There were even more lies: "The affable Lay told everyone that if operating earnings were on target, as it appeared they would be, bonuses would be paid" (Saporito 2002 34) "At a company gathering caught on videotape, the son of a Missouri minister promised that there wouldn't be any layoffs, and that Enron would rise again. For once, though, the rank and file weren't drinking Ke

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audit. In addition (at a date after the publication of this NEWSWEEK issue) many brokerages and financial institutions are also now being investigated to see what role they may have played in setting up some of the "partnerships" and shell companies that permitted Enron to hide its enormous losses. Business practices will be far more closely scrutinized now. So, we know people lied. What is Congress going to do about it? "Legislation sponsored by Rep. John J. LaFalce (D.NY) also would establish a new accounting industry oversight boarda.Congressional investigators say they are close to a deal with Enron to allow public disclosure ofa.tax records" (Bloomberg 2002 C5) In addition, Arthur Andersen executive, David Duncan, who was fired by Andersen after admitting he shredded key evidence, "pleaded guilty to obstruction of justice, admitting he tried to thwart an Enron investigation by the Securities and Exchange Commission" (Hays 2002 2) He was cooperating with the government investigations in return for a plea bargain. Since all the other major "players" in the Enron case have refused to answer questions, and taken The Fifth, chances are legal actions will be proceeding against Ken Lay and his team as the investigations
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Some common words found in the essay are:
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Approximate Word count = 3663
Approximate Pages = 15 (250 words per page)

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