Enron Debrief, Essay Example

The concept of business ethics has been widely accepted and infused in most organizations. Ethics simply entail moral rules that govern appropriate conduct. Therefore, when an individual behaves in an ethical way, he or she is doing that which is morally appropriate. This kind of practice has been perceived as appropriate in enhancing the performance of a business. A decision that is ethical should also be lawful and be able to meet the needs of community members. Businesses are faced with issues related to ethics on a daily basis and in some companies, the problems are extremely serious and have caused society members major losses. The case of Dennis Kozlowski and Mark Swartz who were accused of defrauding charities over eighteen million dollars in “A review of There’s No Such Thing as “ Business” Ethics by John C. Maxwell,” is a good example of major ethical issues facing businesses today (Gill 135). Such occurrences reveal that leadership in some businesses is being conducted unethically. There is need for business ethics and organizations cannot survive or thrive without enforcing this concept in their daily operations.

The Enron case study is another example of the serious issues that can arise when ethical leadership is not appropriately applied. Most of the problems that occurred at Enron can be blamed on the company leaders, starting with its founder Kenneth Lay and his successors. All these leaders failed when it came to tackling significant ethical challenges relating to leadership. Enron leaders established a punitive culture in their organization in that top managers grabbed all that the company had gained. Enron put more effort in hiring people but fired them in a split of a second. The company management had established an appraisal system where employees were evaluated two times annually (Swartz &Watkins 192). The employees were then categorized into three levels depending on their performance. The employees at the top level were good performers and were rewarded while those who belonged to the lower level were told to either improve or find their way out of the company. Enron did not value kindness and believed that it was a sign of weakness in its own way. Company cohesion and ethics were in turn destroyed following this system and employees were scared of questioning any inappropriate conduct. The organization and its leaders expired in the long run since the appraisal system, which was discriminative, became dysfunctional.

Adam Smith’s assertions that self interest is good and every individual is led to pursue his or her own good by an invisible hand and the achievement is best, for all are rather common (Smith 644). If Adam’s assertion is true then it becomes quite tricky to discuss the concept of ethics. Ethics require that human beings act not due to self interest but because it is morally right to behave in a particular manner. Moral decision making also necessitates that choices be made not out of self interest but the interest of others as well. Ethics dictates the consideration of other people’s interests. The ethical outlook is above self interest and takes in to account everyone’s consideration. Ethics thus fails to acknowledge self interest as a foundation to human behavior. Some philosophers and scholars have tried to link self interest and ethics, though their quest has not been largely recognized. Ethics believe that human beings can control their ego and put in the interest of others rather than their own.

Work Cited

Gill, David. A Review of There’s No Such Thing as “Business” Ethics by John C. Maxwell. New York: Warner Books, 2003. Print

Swartz, M., & Watkins, S. Power Failure: The rise and fall of Enron. London: Aurum Press, 2003. Print

Smith, Adam. An Inquiry into the Nature and Causes of the Wealth of Nations. New York: Pennsylvania State University, 2005. Print