Business Ethics and Organizational Culture
Module 5 Case
ETH 501: Business Ethics
Dr. Gary Shelton
March 18, 2012
This paper will critically evaluate the Enron case in the context of the organization’s culture. How Enron’s business ethics and business operations being influenced by the culture of the organization will be discussed. Specifically what went wrong within the inter workings of the Enron corporation will also be included. What leadership should have done and what they did to negatively reshape the culture along with the consequences of their actions will be brought to attention. Lastly, the central role of Human Resources Management and how they could have guided leadership to possibly avoid this issue all together will come to light.
It seems clear that the strengths and limitations of Enron’s culture let to its demise. Unethical or even illegal actions by employees are sometimes just general problems that unfortunately occur. In this case Enron’s systems of accountability, oversight, ethical disclosure, and priorities were seriously flawed.
Enron’s corporate culture created by Jeffrey Skilling when he took over as CEO reflected a willingness to take risks, take an aggressive approach to growth, and innovative creativity. Typically these are all good values to have, however the problem was the values were not in balance with a good eye when it comes to integrity and the value of consumers and shareholders. They had blinders on by just focusing on maximizing the price per share and didn’t look at the big picture. Unfortunately this makes even the positive values that instilled a liability to the company.
Even though the corporate culture seemed to be about a value, it really was a strategy to create a massive company that could use its size to push around people who might question their accounting practices. The risk of this type of unstable and creative culture led to more aggressive purchasing to maximize share...