Arthur Andersen And Lehman Brothers Case Study

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Analyse the corporate culture at Enron, Arthur Andersen and Lehman Brothers and discuss any similarities / differences, and the link between corporate culture, greed and fraud. Provide specific examples to justify your answer.
In essence, for the three companies considered, as a corporate culture…”Greed is good”. The original virtues of Enron, Arthur Andersen and Lehman Brothers were all, over time, replaced by those three simple words…”Greed is Good”, and the damage that motto caused on Wall Street and across the globe was, is, and will probably be again, phenomenal.
Deregulation of the financial services industry provided the key to unlocking the gates to a corrupt corporate world filled with greed and disastrous levels of fraud. Enron …show more content…

They also lobbied with other banks to increase the level of ‘acceptable’ loan to capital leverage limits, enabling them to put investor’s funds more at risk whilst greedily accepting their profits and bonuses (Clark, 2010).
Richard Fuld and the other senior management executives at Lehman Brothers displayed similar traits to the executives at Enron, being high risk takers – with other people’s money, gamblers, charisma which inspired almost ‘cult like’ followings by staff and an attitude that they were right. However they did not promote a corporate culture as espoused in their company’s Code of Conduct, but displayed unethical behaviours that filtered down from the top to the bottom of the …show more content…

Matthew Lee, the Lehman ‘whistle-blower and a former senior vice-president in Lehman’s finance division, experienced these unethical behaviours first hand when he was fired after submitting his letter outlining his six major concerns about the corporate culture and company’s business dealings. Even the Sarbanes-Oxley Act (2002), which states publicly traded companies are to have an audit committee that will look at employee concerns and will not retaliate, failed to protect him (Clark, 2010).
Enron
‘Enron was developed in 1985 to value respect, integrity, communication and excellence’ (Martin, 2013). Not long afterwards, a corporate culture of ‘we know more than you and therefore you should do as we do’ exemplified the behaviour of Enron’s senior executives and permeated throughout all levels of the company. An environment ‘driven by intimidation and arrogance from company leaders’ suggests former employee and ‘whistle-blower’, Sherron Watkins, ‘They were swindlers’ (Martin, 2013).
Ken Lay, Enron CEO, supported deregulation in a quest for opportunities to raise money for their business ventures and was well acquainted with several US presidents. Again, self-regulation providing the opportunity to embark on creative accounting practices that put profit above

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