Enron Case Analysis

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Enron’s ride as a company was truly a ride of broken dreams. From being one of the top regional gas pipeline traders, to the nation 's 7th largest corporation, to the world’s largest energy trader; and in a matter of 24 days they fell down into a hole of bankruptcy and dishonor. What took Enron 16-years to grow from $10 billion of assets to $65 billion was all gone in a matter of days. While Enron’s story is one of numbers and transactions it is also a story of human tragedy, a story of major misconduct within a top corporation. As shown in the documentary, Enron: The Smartest Guys in the Room, Enron became one of the worlds most acclaimed business ethics case of the century. The documentary explored the good, the bad, and the terrible of a company that was once #1. In any organization of 30,000 or more…show more content…
When put in an ethical situations, people use different reasoning’s’ and perspectives to resolve their problems to their advantage. There was nobody validating what was going on. This brings the ethical conflict of Andy Fastow into play; one of the key problems within Enron. Andy Fastow was the man keeping Enron 's “successful” business appearance. While the company was $30 billion in debt, Fastow manipulated the books to make it look like they were still making profits. Fastow might have not been the one to begin the fraudulent activities, but he did it in order to please his bosses. He created two partnerships called LJM1 and LJM2; with the plan of buying Enron’s poorly performing stock to improve their financial statements. Additionally, Fastow went in front of the board of directors to exempt himself to run the two companies as well as Enron, aka conflict of interest. According to the documentation, Fastow allegedly collected $30 million in management fees while defrauding his own
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