Ethical Lessons Learned from Corporate Scandals

Ethical Lessons Learned from Corporate Scandals

Ethics is about behavior and in the face of dilemma; it is about doing

the right thing. Ideally, managerial leaders and their people will

act ethically as a result of their internalized virtuous core values.

The Enron scandal is the most significant corporate collapse in the

United States and it demonstrates the need for significant reforms in

accounting and corporate governance in the United States. It is also

a call for a close look at the ethical quality of the culture of

business generally and of business corporations (Lessons from the

Enron Scandal). The collapse of even the smallest of businesses

impacts many people, and therefore even the smallest business can

learn what not to do from the multibillion dollar corporation. The

failure of one’s business will greatly and negatively affect its

employees, partners, as well as the families of each of those groups.

Business owners have a duty to operate in a prudent, lawful and

ethical manner. The major lessons that were illustrated by the

collapse of Enron and other corporate scandals will be the morality

play of the new economy. It will teach executives and the American

public the most important ethics lessons of this decade.

Financial cleverness is no substitute for a good corporate strategy.

Financial accounting is a backward looking, unusually complex, subject

to subjective interpretation, vulnerable to several controversial

accounting doctrines...