Enron Corporation Failure
User Rating: 0 / 5
- Details
- Hits: 14740
Corporation Failure
Most far-reaching moral issues in corporations do not come out by themselves and instead arise from a culture of arrogance and deception within firms making it loose focus. Enron Corporation, an oil and petroleum company one of the successful companies had its best times. A merger between two enterprises that resulted in a large corporation and a leading petroleum supplier (Hosmer, 2011) formed the company. The companies were making profits since the market regulated from both the suppliers and the buyer point, and there were no losses possible. The prices set by the regulator were reasonable for any company to trade on.
The industry was then deregulated, which was received with swing in prices and the demand and supply of the petroleum products. The president of the company saw this as an opportunity and expressed that rules were made to be broken and that some changes have to be effected for the benefit of the firm. The new leader had a goal of succeeding in everything and formulating strategies to achieve such, and with the best workers who were on to achieving their potential; the company could achieve better performance. The company developed strategies, some risky even involving accounting to boost performance (Hosmer, 2011).
The company experienced financial hardships making it run into debts due to the economic strategies that presented risks to it. The practices brought about by the president of the company made it loose financial control and had to bring in measures and boost the financial department with experts to contain the situation. At the time Enron was running on debt, it ensured another risky strategy of investing their risk since it had to achieve performance growth. The company boasted of investing intellectual capital while at the same time it had debt crisis (Hosmer, 2011). The business focused more on larger deals than on book accounting. The company engaged in illegal dealings to salvage its status making it loose, corporate ethics.