4 ethical issues with enron

Russell Ten years ago, Arthur Andersen was forced to surrender its licences in the United States after the Enron scandal, precipitating its global collapse. Russell looks back on the past decade of reactions, reforms and soul-searching in the accounting profession. More significantly for the accounting profession, this May marks a decade since the Enron indictment in the United States, and the beginning of the end for the well-respected firm of Arthur Andersen, one of what was then the Big Five accounting firms.

4 ethical issues with enron

Without ethics in the workplace, a company's internal processes and external dealings would come to a grinding halt. The business world depends on general ethical principles in the workplace to prevent fraud, dishonesty and manipulation toward customers and clients.

If a company is viewed as unethical, investors and customers may be reluctant to purchase products or sink money into operations. Defintion An ethical conflict occurs when you or a colleague makes a decision that could be seen as illegal or inappropriate to a third-party.

Ethical conflicts result from the smallest lies to decisions that can affect employees within the company, investors or customers. Ethical conflicts occur before, during and after decisions are made.


For example, if your boss asks you to shred an incriminating record, this is an ethical conflict even though you have not performed the task. Types There are many types of ethical conflicts in the workplace, however conflicts usually deal with the following categories: Fraud occurs when a company knowingly presents information that is incorrect to employees or the public.

For example, the energy company Enron fraudulently modified its income statement to appear as if the company was performing better than it actually was. A confidentiality ethical conflict occurs when information is viewed or accessed by a party that should not be privy to that information.

Financial conflicts typically involve stealing, either in small or large amounts. For example, taking office supplies from the company supply closet is unethical behavior. Ethical conflicts that develop from dishonesty usually occur because a company does not provide a complete picture of information to customers or employees.

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Resolution Resolving ethical conflicts may be as simple as a discussion with the party engaging in unethical behavior, or, in extreme circumstances, legal intervention. If an employee is frequently playing computer games at work instead of focusing her attention on a project, a discussion about the problem would be necessary.

4 ethical issues with enron

If your company claims a financial loss on a fake product line for tax reasons, the Federal Trade Commission may open an investigation into the unethical behavior. Prevention Ethical conflicts can be prevented in the workplace by using a two-sided approach.

First, your company must educate employees about what is considered an ethical conflict. Education can occur in training sessions or during meetings for other matters. Second, company leaders must set an example for lower-level employees. Decision makers who hold ethics in high regard are less likely to have employees that breach those ethics during the business day.

Marquis has been writing for over six years.This document is designed as an introduction to thinking ethically. It is also available as an app. We all have an image of our better selves -- of how we are when we act ethically or are "at our best." We probably also have an image of what an ethical community, an ethical business, an ethical.

Enron officials acted irresponsibly by failing to take needed action, failing to exercise proper oversight, and failing to shoulder responsibility for . Behaving Badly: Ethical Lessons from Enron [Denis Collins] on alphabetnyc.com *FREE* shipping on qualifying offers.

Behaving Badly: Ethical Lessons from Enron puts the reader in the shoes of Enron executives through the journey of the once prominent and now infamous company.

Examples of Ethical Issues in Business | alphabetnyc.com

Enron began as a newly merged firm in with too much debt. Arthur Andersen and Enron - two names that will forever live in infamy because of the events leading up to and including the debacle of December , when Enron filled for bankruptcy.

The goals of all the curriculum changes are to make accounting graduates better prepared to confront ethical issues so that events such as the Enron/Anderson.

4 ethical issues with enron

She proved that whistleblowing is ethical and right with respect to virtue ethics (Enron: The Smartest Guys in The Room ). The aforementioned theories of ethics clearly have different moral dimensions and methodologies in evaluating unethical behaviour by Enron’s management.

This paper will include a brief history on the Enron case and talk about some of the ethical issues that caused Enron to go bankrupt. It will also include information on the companies that were an integral part of Enron’s demise and the Sarbanes-Oxley Act that was formed due to Enron’s unethical practices.

Ethical Conflicts in the Workplace | alphabetnyc.com