The Corporate Culture In Enron's Case

Corporate culture refers to an organization that shares the same values or beliefs that are usually instilled or passed down by example from the upper level executives throughout the organization (Thorne, O. Ferrell, & L. Ferrell, 2011, p. 191). Most organizations are molded from ideals set in place by the founders or upper level executives of an organization. In Enron’s case, they believed in doing whatever it took and unfortunately it bread competitiveness throughout the company, which forced employees into making unethical decisions in order to save their jobs. The CEO, Jeffrey Skilling, decided to implement a program that evaluated employees every six months and the bottom twenty percent of employees would be terminated. This created a

panic for employees and forced them to make a tough decision. They could either make unethical decisions in order to keep their jobs or they could pack up their things and find another job. This sort of coercive power that was implemented by the CEO forced employees to become fearful for their jobs and forced many good people to make bad decisions. This type of corporate culture helped Enron to continue its unethical business practices and weed out any employees that were not comfortable with their unethical decision making.
Enron created a system that rewarded upper level executives financially and benefited employees that made unethical decisions.

The CFO, Andrew Fastow, systematically falsified there earnings by moving company losses off book and only reporting earnings, which led to Enron’s bankruptcy. Any safeguards or mechanisms that were in place to catch unethical behavior were thrown out the window when the corporate culture became a situation where every person was looking out for their own best interests. There were a select few employees that tried to get in front of the unethical accounting practices, but they were pushed aside and silenced. The corporate culture at Enron became a place where if an employee would not make unethical decisions then they would be terminated and the next person that would make those unethical decisions would replace them. Enron executives had no conscience or they would have cared for the people they ended up hurting. At one time, Enron probably was a growing company that had potential to make a difference, but because their lack of social responsibility and their excessive greed the company became known for the negative affects it had on society rather than the potential positive ones it could have had. Enron’s coercive power created fear amongst the employees, which created a corporate culture that drove everyone to make unethical decisions and eventually led to the downfall and bankruptcy of

Enron.