Essay on Personal Ethical Framework

2584 WordsJan 30, 201411 Pages
According to Johnson (2012) leaders are powerful role models, and policies will have a little effect if leaders do not follow the rules they set. In Enron case, corruption and ethical misconduct were deeply embedded in their business culture where profitability was more important than ethics. In this paper, I will address the factors that had led to the development of the culture of profit before principle at Enron. Also, I will create my personal code of ethics that will guide me in my professional and personal decision making and doing the right thing when faced with ethical challenges. “Enron: The Smartest Guys in the Room” shows us how basic human nature does not change, whether it is firing as a means to resolve disputes, or in the…show more content…
Here, Ken Lay also had casted shadow of misplaced and broken loyalties. Decisions were made without considering their duties to their stakeholders especially the employees. In an interview by Lucas & Koerwer (2004), Watkins stated Enron's most notorious accounting fraud relates to the income statement manipulation (loss avoidance) that occurred via the use of the "Raptor" structures. Watkins added that, in early 2000, McMahon went to Jeff Skilling and said that the conflict of interest between Enron and Andy Fastow's LJM fund was getting out of hand. Skilling ended up moving McMahon to a different department. Because of this people in accounting stopped protesting.. In the documentary video, Bethany McLean stated that Enron’s Financial Statements does not makes sense; “the company was producing little cash flow, and debt is rising”. Fraud was present. “The company's lack of accuracy in reporting its financial affairs, followed by financial restatements disclosing billions of dollars of omitted liabilities and losses, contributed to its downfall”(Effects of Enron, 2005). This is dishonesty at its best in accounting world. Lucas and Koerwer (2004) wrote, “every single thing that Enron did had shades of dirty play associated with it”. Ken Lay would say, "I always try to hire the best people for
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