The Analytical Contrast of Corporate Deviance in Differential Association and Strain Theory

It's difficult not to be cynical about how “big business” treats the subject of ethics in today's world. In many corporations, where the

It's difficult not to be cynical about how “big business” treats the subject of ethics in today's world. In many corporations, where the

In “Cheating in a Bottom Line Economy,” author David Callahan explains the fundamental reasons for the decay of simple business ethics in today’s economy in order to meet bottom line standards. Callahan draws conclusions from everyday businesses such as auto mechanic services, law offices, and even professional medical firms to prove that people will almost always choose financial stability over integrity. The economic life in America has transformed itself into a vast land of professionals focused on achieving “lean and mean” businesses in efforts to achieve the “American Dream,” but in essence lose sense of their morals.

Early versions of strain theory were not supported initially and came under criticism due to the inherent theoretical limitations as well as a lack of an empirical support for their propositions (Agnew and Passas, 1997; Burton, Cullen, & Evans, 1994; Kornhauser, 1978). The main argument of classic strain theories is that individuals, under a disadvantage caused by the discrepancy among the lower class demographic, are pressured to achieve certain universal goals. Failing to achieve them through legitimate avenues, they resort to

First of all, what is “Social Strain Theory?” Robert Merton who is a theorist and creator of Strain Theory has allocated that “strains” are instigated by United States social structure which dictates equivalent goals in terms of success and job status within all members of society despite all members not having equivalent means to achieve money and success. Those that have that have obstacles in the way of achieving success and wealth experience strain and could engage in criminal behavior (Merton). In this theory Merton also created “Deviance

The business world is an interesting environment that is often described as heartless and cutthroat. However, while it is described that way, ethics do still apply to the business world. Companies and corporations are expected to adhere to the ethical code that has become engrained in business world. Unfortunately, however, despite the existence of that expectation, some companies and corporations do not always act in an ethical manner. Enron is an example of one of those ethically challenged corporations. In this paper, a brief summary of the Enron scandal will be provided and an analysis utilizing the principles of Catholic Social Teaching (CST) will be conducted. Through the analysis, it will become apparent that Enron’s actions definitely conflicted with several CST principles.

Americans have decided to trade in their dreams of a white picket fence, for the dream of white fenced in mansions. No longer are people going to settle for the success of middle America. People want to be at the top and they will do whatever they need to get there. This desire of luxury over moderation is shown in David Callahan’s book The Cheating Culture. In this example Callahan shows how Sullivan, a newcomer to the elite business world, lets his desire for luxury to override his integrity.

As with much of Enron, their outward appearance did not match what was really going on inside the company. Enron ended up cultivating their own demise for bankruptcy by how they ran their company. This corrupt corporate culture was a place whose employees threw ethical responsibility to the wind if it meant financial gain. At Enron, the employees were motivated by a very “cut-throat” culture. If an employee didn’t perform well enough, they would simply be replaced by someone who could. “The company’s culture had profound effects on the ethics of its employees” (Sims, pg.243). Like a parent to their children, when the executives of a company pursue unethical financial means, it sets a certain tone for their employees and even the market of the company. As mentioned before, Enron had a very “cut-throat” attitude in regards to their employees. This also became one Enron’s main ethical falling points. According to the class text, “employees were rated every six months, with those ranked in the bottom 20 percent forced to leave” (Ferrell, 2017, pg. 287). This system which pits employees against each other rather than having them work together will create a workplace of dishonesty and a recipe of disaster for the company. This coupled with the objective of financial growth, creates a very dim opportunity for any ethical culture. “The entire cultural framework of Enron not only allowed unethical behavior to flourish,

In Merton’s version of the anomie/strain theory he pointed out five adaptations to strain: conformity, innovation, rebellion, ritualism, and retreatism. Conformity means that one accepts both the goal and the means. They may try to attain the goals with limited means. This adaptation is most common in society. Innovation means that one accepts the goals but rejects the means. This individual has a “by any means necessary” attitude when it comes to the attainment of goals. Rebellion means that one rejects both the means and the goals. They may substitution those goals and means with their own goals and means. Ritualism means that one rejects the goals and responds to the means in a slavish and conforming attitude. Retreatism means one rejects both the goals and means, but they do not replace with their own goals and mean. Instead, they will drop out of society and into things such as alcoholism, drug addiction, and homelessness. This adaptation is the least common in society.

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.

This is opposed to strain theory which argues that social and personal strain “force the hand” of individuals and cause them to commit crimes. However, the weakness of this theory in regards to white-collar crime is the question of why those who've already gained financial success wish to seek more of it through illegitimate ways, particularly if they earned their initial success in a legal manner.

Enron’s ride is quite a phenomenon: from a regional gas pipeline trader to the largest energy trader in the world, and then back down the hill into bankruptcy and disgrace. As a matter of fact, it took Enron 16 years to go from about $10 billion of assets to $65 billion of assets, and 24 days to go bankruptcy. Enron is also one of the most celebrated business ethics cases in the century. There are so many things that went wrong within the organization, from all personal (prescriptive and psychological approaches), managerial (group norms, reward system, etc.), and organizational (world-class culture) perspectives. This paper will focus on the business ethics issues at Enron that were raised from the documentation Enron: The Smartest Guys

Douglas McGregor was a management professor at the MIT Sloan School of Management. He introduced a new motivational theory in his book ‘The Human Side of Enterprise’, stating that all workers were divided into two groups: Theory X and Theory Y. Theory X workers were lazy, irrational and unreliable, and were only motivated by money and threatened by punishment. Theory Y workers were able to seek and accept responsibilities and fulfil any goals given.

Corporations can be deviant if a majority of the employees are engaging in the deviant acts. Sometimes employees, especially lower level employees, can feel pressured to commit or go along with

It seems like business morals and ethics are being whisked to the side in lieu of the ever growing demand of higher stock prices, rising budget goals and investor profits. Despite the increased regulation of corporations through legislation, such as, Sarbanes-Oxley, some corporations still find themselves struggling to maintain ethics and codes of conduct within the workplace. In reviewing the failings of the Enron Scandal, one can heed the mistakes that both individual and organization malaise, such as, conflicts of interest, lack of true transparency and the sever lack of moral courage from the government, executive board, senior management and others, contributed to the energy giant’s downfall.