ENRON COMPANY SCANDAL - An Ethical Analysis

US energy company based in Houston Texas Employed approximately 22,000 Declared bankrupt in late 2001 Fraud was detected in the fact revealing

Enron shares hit high prices near $90 After the fraud detection the share prices fell to $0.12 Large number of investors lost their money comprising total loss of $11 bn

The scandal was related to misleading the public about the true condition of the company The debts and losses of the company was hided and the revenues were shown increasing

The chairman Mr. Ken Lay admitted that the company performance was not good at any point of time. The accounting firm Arthur Andersen was also involved in the whole process and they are also blocked from further business.

Changing scenario To raise its market stake in a consecutive manner. Showed only the profits to attract more public Wrong approach for a public company

The companys act of not revealing the internal information to employees and public caused huge losses The hiding of documents related to some transactions and debts

The Enron Company did adopt the utilitarian approach The hided and told lies to the public and employees. The higher management pressurized executives to discover new methods to of hiding information.

Business ethics involves set of actions that make company more favorable to public and employees. It defines the code of conduct for employees It makes the company activities more legal and policies more social

Company could have restructured its departments. The quality improvement strategies should have introduced. Quality improvements would have led to decrease in losses.

The quality improvements decreases the errors in misacts of the company operation Enron should have performed better if it could have adopted dynamic strategy to overcome the changing environment and market.