The Ethics Of The Enron Case

1622 Words Aug 23rd, 2015 7 Pages
Introduction The Enron case is well known for being the largest corporate bankruptcy in American history. Thousands of people world-wide lost billions of dollars, lost life savings, and lost their jobs. Due to the vast corruption, greed and the blatant disregard for integrity from the very top of Enron leadership, world markets crumbled and investor confidence in corporate America was severely damaged (Chandra, 2003.)
We will look at the accounting fraud committed by Enron executives and interested parties. We will run their accounting tactics through the Utility Ethics test to determine if there were alternative actions that would have been considered ethical as determined by the test.
Introduction of the Test
Were the accounting tactics employed to make as much profit as possible worth the potential cost to Enron’s stakeholders? The central question is was the corporation maximizing the best interests of all stakeholders and minimizing the bad consequences for its stakeholders?
Why is the Utility Ethics Test valid to determine right and wrong in the Enron case? Utility Ethics is a valid method to determine ethical and unethical behavior because it takes into consideration the interests of all parties involved. There are no favorites and all are equal using this theory. Enron leaders are no more important than board members, lower level managers, other employees, investors, banks, auditors, or the outside agencies with which they partnered. They are all of equal…

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