1)Based on what you read in this chapter, summarize in one page or less how you would explain Enron’s ethical meltdown.
Enron’s ethical meltdown came from a lack of moral awareness, and managers who did not properly encourage and model the ethics of the company. The company obviously underwent moral disengagement at one point and no one did anything to fix the issue. The company did well in creating a code of ethics, but failed to recognize that it is not enough to just create one and that the company needs to be proactive in implementing it and making it a part of their culture from the top down.
2) It is said that when one securities analyst tried to confront Enron’s CEO about the firm’s unusual accounting statements, the CEO publicly used vulgar language to describe the analyst, and that Enron ...view middle of the document...
The way this CEO and the employees supposedly responded seems pompous and selfish which speaks eons for a company with loose morals, and a pompous attitude. It seems as if Enron does not really have a moral or ethically sound culture.
3) This case and chapter both had something to say about how organizational culture influences ethical behavior. What role do you think culture played at Enron? Give five specifics examples of things Enron’s CEO could have done to create a healthy ethical culture.
Despite the fact that Enron had a code of ethics, a reporting system, and videos discussing company values, they still ended up becoming an organization known for poor ethics. I think the business culture at Enron was a unique one since they primarily did negotiations and bargaining as a whole seller company working between suppliers and customers. I believe that Enron started off with good intentions, but due to a work culture that did not align with things such as their code of ethics, they turned the other way. Enron should have created a better culture where unethical behavior was unacceptable. The CEO should have never made the vulgar remarks that he did and the employees who thought this to be humorous should have been reprimanded. I assume that in the beginning of the company they had a more ethical culture, however, failure to continue to support their code of ethics and a lack of use of the reporting system changed the culture. Enron should have made sure every employee read and understood the code of ethics, that they felt comfortable to use the reporting system, that the higher ups modeled the way in terms of ethical behavior, that the company’s ethics code came about from their mission and values statement, and that they promoted a healthy and honest work culture.