Enron's Debt

In: Business and Management

Submitted By chloe
Words 277
Pages 2
The Unethical Behaviour of Enron
Before filing for bankruptcy in 2001, Enron Corporation was one of the largest integrated natural gas and electricity companies in the world. It marketed natural gas liquids worldwide and operated one of the largest natural gas transmission systems in the world, totaling more than 36,000 miles. Enron was also a major supplier of solar and wind renewable energy worldwide, managed the largest portfolio of natural gas-related risk management contracts in the world, and was one of the world's biggest independent oil and gas exploration companies.

The Enron scandal involves both illegal and unethical activity and the courts of law will determine the precise extent of civil and criminal liability that accrues to the perpetrators (Verschoor 2002; Fusaro and Miller 2002). People commit fraud, for instance, for a wide range of motives including perceived lack of effective deterrent punishment and rationalization of acceptability of illegal activity (Albrecht and Searcy 2001). To control fraud by focusing on only one dimension, such as more effective deterrent punishments, is like trying to put out a skyscraper fire with a garden hose. In addition, people harbor myths, such as organizations cannot proactively detect or prevent fraud, which only result in disempowered resignation to the inevitability of corruption and more future Enrons (Albrecht and Searcy 2001).
The Source of Enron’s Problems * Enron started to collapse in June, 2001 * Used poor accounting procedures * Failed to record all assets on balance sheets * Problems was compounded thousands of times
Ethical Dilemma: * Stockholder reports inform public about financial information and business transactions * Enron officials did not notify public about accounting practices * Should Enron have informed the…...

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