Enron Case Study

375 Words2 Pages
The collapse of Enron happened for several reasons, from bad leadership, dysfunctional corporate ethics, and fraud. Enron’s code of ethics were founded on respect, integrity, communication, and excellence, Both Lay and Skilling were aware of the code of ethics and how the company should be run, but disregarded and did not follow the code of ethics. Kenneth Lay who was the CEO of Enron and Jeff Skilling, Chief executive, were both key factors to the fall of the company. By the time that Enron fell both Lay and Skilling had charges of fraud, misleading statements, misleading statements on financial reports and conspiracy. Among Lay and Skilling, there were other executives that had been involved in the schemes. Andrew Fastow, the Chief financial officer, was among one the many of Enron’s key executives that contributed to the fall of the company, engaging in money laundering, fraud and conspiracy, which in this manner was undermining Enron’s code of Ethics. Overall Enron’s executives did nothing to promote and achieve the company’s concept and values, by doing what they did and undermining Enron’s Code of Ethics and what the company stood for, Enron went from being one the nations largest company, to a dramatic fall. Many of Enron’s employees were lead to believe that they could get away with what they were told to do until they got caught, and if when they were caught, they were told to ask for a second chance. The company emphasized on decentralization, and was inadequate with operational, and financial controls. The corporate culture didn’t seem to make any efforts to adhere to the code of ethics, instead they stuck to what they were told to do which was to inflate contracts and hide their losses. “Some former Enron employees are embittered by the way they have been treated by the company that once was “best in t he business”, but others disagree” (Thomas).
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