How Poor Business Ethics Led To The Collape Of Enron Ethics

The Enron Corporation was one of the largest companies which sold electricity and natural gas, distributed energy and other services like bandwidth interest connection and provided risk management and financial services to consumers the world over. This company became rich because of its initiative marketing and endorsement of power and communications bandwidth services and risk management offshoots. All these services were supervised by the operations management department but there existed other management departments which carried out half of their functions. Though these functions were purely executive in nature, there was lack of integrity, responsibility, creativity and control. The absence of these ethics led to the bankruptcy of the company. In other words, Enron ethics was ignored by the employees while working.

In an organization, the functions of the operations management department should consist of ethical values, integrity, competence and clear accountability of term papers. But Enron did not abide by these functions which led to its bankruptcy. We may say that the company’s employees lacked Enron ethics. As the company’s reputation grew in the global world, the competition within the employees rose and hence individual greed also generated in the atmosphere of the company’s egotism. Every employee wanted to make it big, achieve a lot within the company, and thus there was high motivation to succeed and earn more. But in such an atmosphere, the tendency to distrust people around is high as each is only concerned about themselves. With the mistrust among the employees booming, highly confidential term papers got used in trade contracts. Thus, trading contracts were made in secret and its admission was also kept undisclosed. Dealings in the finance section grew rapidly without paying much attention towards the company’s goals. Hence, the employees had started to ignore Enron ethics.

As a result, we cannot say that the problem rose due to the accounting practices only. It is not the financial department which is to be blamed solely. The problem which led to the bankruptcy of the company lay in the operations management department. On one side, Enron was gaining praises from the outsiders and on the other side, it was full of decentralized financial control and decision making structure which gave an illogical and unclear picture of the company’s activities and operations. But we cannot say that the managerial performance was poor but the departments were ruining the ethical values and principles of the company. It was the duty of the managers and directors to check whether Enron ethics is being followed in their company or not. If they had supervised properly then they could have escaped from this bankruptcy tragedy.