Ethics in the management of business enterprises began receiving renewed emphasis in academic circles in the United States in the early- to mid-1990s (Black, 1997). Unfortunately, this renewed emphasis was a little late for the most serious of the recent outbreaks of ethical lapses in free market business firms in the United States that rocked American society in the late-1990s and into the early years of the 21st century (Ang, 2000; Hanson, 2003).
The problem did not stem from an absence of formal codes of ethics in place in American corporations. Enron, one of the worst of the corporate offenders, had a formal code of ethics in place, as did the other American corporations that were caught in the scandal. Enron published its ethical values as a treatise on what the company referred to as a Statement of Human Rights. The company also published a formal Code of Ethics, which, in part, duplicated the Statement of Human Rights.
The problem was that the leadership at Enron and other corporations paid no heed to the ethics codes in place. Rather, leadership either participated in or turned a blind-eye to unethical behavior so long as financial objectives were being served and none of the behavior was exposed. When the unacceptable behavior was exposed boards of directors and corporate executives at first denied the violations and then feigned horror at the actions that were the "work of a few rogue" employees (much as the military prison scandals have been treated by the federal government).
Boards of directors began doing their jobs when it was apparent that they had no other viable choice. The Congress (in response to public outrage) enacted laws that made specific demands, and threatened to enact additional laws that would place board members at financial risk for corporate ethical lapses. How long the change in orientation will last is uncertain. Some influential corporate leaders and their paid hacks in the Congress ...