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Responsible of Commerce

In: Business and Management

Submitted By ShawnNg1101
Words 613
Pages 3
1. What were the individual factors that contributed to the failure of Enron? Briefly explain two key factors. Greed was the first individual factor that one can blame for the failure of Enron. As the greed of gain has no time or limit to its capaciousness, the executives did massive fraud and insider trading in order to get more profit because of their egoism, self-interest. As a result, their irresponsible behaviour led the company into bankruptcy with numerous executives charged with criminal acts. The failure of leadership was also one of the individual factors that contributed to the collapse of Enron. The actions of Enron’s leadership did not match the company’s expressed vision and mission as well as it values. If Enron leaders like Kenneth Lay and Jeffrey Skilling had also adopted strategic leadership, they could have also become able to bring a strategic change as required throughout its worse period. There were many top executives engaged in many unethical behaviours like making a false financial statements, misleading statement and frauds,etc as a result of slippery slope. Andrew Fastow (CFO), Jeffrey Skilling (CEO), and Kenneth Lay (auditor) are among the most notable top-level executives implicated in the collapse of Enron. In fact, the board of directors should have prevented all of the unethical behaviours from happening.
2. What were the organisational factors that contributed to the failure of Enron? Briefly explain two key factors. The first organisational factors that contributed to the failure of Enron was the manipulative accounting system. Arthur Andersen, an auditor and consultant, was convicted of obstruction of justice for shredding documents related to its audit of Enron, resulting in the Enron scandal. The impact of the scandal combined with the findings of criminal ultimately destroyed the firm of Enron in which Nancy Temple...

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