The Impact of Ethics on the Enron Corporation

2018 WordsNov 20, 20059 Pages
Ethics is something that is very important to have especially in the business world. Ethics is the unwritten laws or rules defined by human nature; ethics is something people encounter as a child learning the differences between right and wrong. In 2001, Enron was the fifth largest company on the Fortune 500. Enron was also the market leader in energy production, distribution, and trading. However, Enron 's unethical accounting practices have left the company in joint chapter 11 bankruptcy. This bankruptcy has caused many problems among many individuals. Enron 's employees and retirees are suffering because of the bankruptcy. Wall Street and investors have taken a major downturn do to the company 's unethical practices. Enron 's…show more content…
Obviously, investors were cheering as huge dividend checks arrived. CBS News caught several Enron employees incriminating themselves on tape. (See http://www.cbsnews.com/stories/2004/06/01/eveningnews/main620626.shtml) However, the scandal brought the company crashing down into bankruptcy. The value of the stocks came plunging down, which caused an overwhelming negative impact on the investors, many of whom lost a substantial amount of money. The real problem is that most of the investors who lost money were actual employees of the company. Most Enron employees were urged to buy company stock as part of their 401k plans. Within months, all the investments were gone. Certainly, the ethical actions (or lack there of) caused a negative impact on the company 's investors. The evidence presented shows how ethical actions can either have a positive or negative impact (or in this case, both) on investors. Retirees The Enron scandal was another instance where unethical decisions have cost numerous people jobs, money, and even stress related health problems. A few people cost thousands of retirees millions of dollars in a matter of days. When Enron filed for protection from creditors on December 2, 2001, 20,000 employees were left without jobs and retirement. Only months before the crash, stock prices were beginning to plunge. Enron barred the employees from selling their stock shares from retirement

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