Enron Committed Suicide

In: Business and Management

Submitted By underwoodre
Words 980
Pages 4
Enron Committed Suicide
Name
Leadership/LDR 531
April 11, 2011
Instructor

Enron was considered the major player in energy and considered as one of the most successful companies until it collapsed in 2001. Failure of this company did not only affect the employees and stakeholders, but also it had a negative impact on the United States economy. Public scrutiny of Enron’s failure, through legal battles, revealed how the toxic organization leadership and culture were two of the major reasons the world’s top energy company collapsed. In this paper, the subject to be examined is how Enron’s organizational structure, culture, and the major contributors contributed to its failure.
Enron’s Failure “Originally a gas pipeline company, it metamorphosed into the world's largest trader in gas, electricity, water, and all sorts of post-modern commodities such as bandwidth” (Gutman, 2002, p. 1). It appeared that Enron was one of the most successful companies in the United States. Share prices were doing well in the stock market, and the share value consistently grew, making them very attractive. The company’s growth was perceived as genuine until the company suddenly collapsed, leading to a disclosure of a scandal that involved the top leadership of the company. The scandal that led to the failure of Enron did not happen overnight. The failure was rooted in the company’s unethical leadership (Weidlich & Calkins, 2006). Enron’s fast rise to the largest energy management firm mirrored its demise because of unethical practices by Jeff Skilling the Chief Executive Officer (CEO), and Andy Fashow, the Chief Financial Officer (CFO) (Gutman, 2002). Enron’s leadership were accused of profiting from their activities, allowing the company to hide the massive debt but yet report good results until the lies could not hold, costing the investors upwards of $30…...

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