The attitude that I find most offensive of the Enron's leaders is individual insubordination. The leaders encourage the employees to manipulate the financial transactions for their self-interests .Their individual insubordination put the company's fate at stake and as such the abused the shareholders' trust.
The shadow that created a major role in Enron's collapse is irresponsibility. The leaders at the company were very irresponsible and as such they did not exercise the required oversight over the company's affairs. The leaders encouraged the employees to attain the financial goals by wrong means, and this ended up misleading the shareholders.
The board of directors at Enron was partly responsible for what occurred at Enron because they failed to strengthen the independence of the audit committee. The board did not question the financial and accounting maneuvers at the company despite the fact that they were unsustainable. Further, the directors did not monitor the accounting issues that were related to its special purpose entities.
Laws should allow the government to look restitution from the estate of those who are convicted of a crime, but they die before appealing their convictions. The change will help the stakeholders to get justice for the loss they suffer due to the violation of ethics by managers in their companies.
In all the cases, the leaders did not comply with the require ethics. Another similarity is that in all cases there is a lack of corporate social responsibility. Further, the breach of ethics ruined public trust in the companies, and this lowered the value of their shares in the stock market.
Tough standards on the preparation of companies' audit reports should be introduced, and the public accounting companies should be barred from offering non-audit services to their clients. All companies should ensure that the audit committees are independent of all stakeholders. There should be an expansion of the disclosures on the financial disclosures of the companies that have transactions with other unconsolidated entities.
A good leader should not abuse power because it affects all the stakeholders. Excess privileges mat make leaders take advantage of the shareholders. Mismanagement of information is costly for all organization. All leaders should act responsibly by exercising oversight and taking the required actions in various scenarios. Additionally, a good leader should not misguide the followers.
Casting shadows at ENRON (P.34-38)