Homework Question Business Studies Essays on Enron’s fall
- Write a substantive a post at least 275 words in length. The post should include appropriate foundation knowledge, be supported by at least two academic sources (peer reviewed articles), follow the APA 6th Edition formatting guidelines, be factual and enhance the ongoing dialogue.
- MUST ANSWER THE QUESTION COMPLETELY. APA FORMAT. NO TITLE PAGE NEEDED.
- Discussion Question: Review the Enron case information presented in the textbook(Meeting the Ethical Challenges of Leadership: Casting Light or Shadow). If you were a high-level leader in this corporation, how might applying your personal ethics have changed the outcome?
Homework Answer on Business Studies Essays Enron’s fall
Enron’s fall could be traced from the company’s choice to utilize a new accounting method dubbed “mark to market”. With this method, price of security was recorded daily to assist in ascertaining profits and losses. The method allowed managers in Enron to project earnings through long-term contracts. However, the new method made it hard to demonstrate how Enron was making its money.
The government insisted that Ken Lay, the CEO, and Jeff Skilling, the former CEO, deliberately altered the company’s financial conditions presented to stakeholders to enrich themselves (Ferrell, O., & Ferrell, L., 2011, p. 213). They unethically misused their powers to enrich themselves.The managers tried to hide their scheme through unethical behavior, which resulted in bankruptcy. As a high-level leader in this company, it is essential to utilize methods that are familiar to all stakeholders, so that they can follow what is going on in the company.
Managers should hold on to ethical responsibilities, which are in line with the stakeholders’ needs. According to ethical relativism, morals evolve to fit the social norms, thus, people should transform their personal morals to calibrate into societal values (Evans, 2012, p. 37). Company needs are placed before personal needs.Internal control of the company is quite vital, thus, managers should cultivate good relationships with junior employees to ensure smooth running of the organization. They should be loyal to the stakeholders, even when the company is not doing well.