Ethics Of Enron A Corporate Disaster - 1408 Words

The Ethics of Enron: A Corporate Disaster Racheal D. Smith Salem International University The Ethics of Enron: A Corporate Disaster Ethics, as stated by Dawn D. Bennett-Alexander and Linda F. Harrison in The Legal, Ethical Regulatory Environment of Business in a Diverse Society, are considered subjective laws as well as a how-to-guide for businesses in how they conduct themselves with their suppliers, customers, employees, and anyone else they do business with (2012). It is not enough to know how to run and conduct business, it is also important that good judgment, situational experience and common sense be used in order to be successful and remain that way (Bennett-Alexander Harrison, 2012). There have been companies in the†¦show more content†¦It was due to Ken’s ambition to turn the stable business from a pipeline company into an energy powerhouse (DiLallo, 2015) and the reported â€Å"error of judgment† in the handling of the debt in the overstatement of profits when there had been substantial losses between 1997 and 2000 by the company’s chief auditor Andersen (Enron: The Re al Scandal, 2002), that Enron accrued its overwhelming debt, one that was not accurately reported, and, later, it lead to the company filing Chapter 11. Enron’s debt was not only caused by the ambitious desire for growth and corporate dominance in the arena of energy (DiLallo, 2015), but also because the top 140 top executives received $618 million total salaries in 2001 alone (Enron Fast Facts, 2015). Two of the major players, Jeffrey Skilling, CEO, and Ken Lay, CEO from 1985 to 2000 and then again in 2001 after Skilling resigned, reportedly received $41.8 million and $67.4 million respectively according to 2015 Enron Fast Facts. On December 2, 2001, the once powerful energy company declared bankruptcy to the crippling total debt of $38 billion (DiLallo, 2015) after the U.S. Securities and Exchange Commission (SEC) opened an investigation against Enron’s transactions on October 21, 2001 (Enron Fast Facts, 2015). Andersen, the company’s chief auditor, created off-balanced-sheet entities for Chewco, Whitewing, LJM, and Raptors that exposed the fraud that was crucial in bringing down Enron (DiLallo,