ENRON CASE WRITE UP

Case Facts

How was Enron created?

Enron was created out of the merger of two major gas pipeline companies in $1985.$

$2.$ How was the corporate culture at Enron described?

The corporate culture at Enron was described as "arrogant." Their executives believed that competitors had no chance against them.

$3.$ In what way was Enron's collapse a failure of corporate governance?

$4.$ What is the "rank & yank" system?

Enron's employees were rated every six months, and those ranks in the bottom $20\%$ were forced out.

$5.$ How were debts covered up$?$

$6.$ How did the Vice President try to stop the cover up$?$ Was she successful?

$7.$ How did the actions of the CFO, CEO, Enron's lawyers contribute to Enron's demise?

$8.$ What criminal penalties were imposed on the CFO, the CEO, and Enron's lawyers?

$9.$ What new legislation $($law$)$ was passed after the Enron sandal and what does it say $?$

$10.$ What lessons should businesses learn from Enron?

$11.$ What would you do if you worked in a company that wanted you to do something unethical? Would you feel protected by the Whistle Blower Protection Act?

Reflection of the Case: Respond to any one of the following statements and explain your answer.

"Was this a gradual situation which developed $-$ a slippery slope $-$ where aggressive accounting gradually led to creative then fraudulent accounting, or was it a more "static" situation where Machiavellian people $($cruel leaders$)$ influenced the company?"