Jeff Skilling and Kenneth Lay
This week’s blog covers the energy industry and the effects of wrong ethical decisions by very high and powerful people of Enron. Enron was a prospering company and once made it onto the Fortune 500 list. This is before the truth about the company came out publically to the world. After the Enron trial, Jeff Skilling, former CEO, and Kenneth Lay, former chairman, were guilty on accounts of conspiracy and fraud. Both men claimed that they were innocent of any of these crimes. They had covered up millions of dollars in debt letting their employees and the world think that the company was prospering. However, the company had to declare bankruptcy, and many covered up secrets inside Enron began to come out. Financial statements did not back up what was really going on inside of Enron. Skilling and Lay made millions of dollars even while the company suffered.
In a video after the trial, ABC news featured a clip about the Enron investigation saying, “The stakes for the prosecution went way beyond the defendants at trial. If after four years of investigating, they [prosecutors] couldn’t win this case, which had become the symbol for corporate greed; it would seem as if CEOs were beyond the reach of the law.” John Hueston, an Enron prosecutor said, “‘CEO’s cannot hide behind claims of ignorance. That’s especially when they have been paid tens of millions of dollars to be the faithful stewards of shareholders and investors.’”
To view more of this video, please visit http://abcnews.go.com/video/playerIndex?id=9129206
The Enron scandal shows that even CEO’s can mess up but that they also have to face the consequences for their mistakes. Please leave any comments you have about this blog. Also, do you believe that Skilling and Lay deserved this punishment? I look forward to any questions or comments.
Ethical Issues in Industries 
I’m glad the US can claim that we prosecute powerful people. I know it’s really upsetting to see how celebrities get away with a lot of things so it’s good to know that at least CEO’s can be held accountable for their actions and what they did to the many employees of Enron
Andrea,
Your blog does a great job of highlighting some of the juiciest, most interesting ethical issues in business history. You blog acts as a good narrative of extremely important events in history – Madoff, Enron, and the Housing Crisis were all incredibly influential in shaping our contemporary financial environment and you describe each of the events by being simple and informative. What I like most about your blog is your use of different media to improve your blog. Using a mix of different videos, articles, and images creates a strong picture of unethical businessmen and women. If I could offer a suggestion to your blog, I would
include more figures in your summaries to give readers something more to take away.
Such thorough corruption as seen in those running Enron and Arthur Andersen is incredible to me. How their scam of so many people was allowed to run for so long is absolutely astounding in my opinion, and the increased strictness of accounting laws over these large companies is a worthwhile investment. Financial crises such as these destroy lives and ought to be stamped out before they spiral out of control as it did in the case of Enron. I know that students at McCombs are generally of the most upstanding integrity, and I hope future Texas Exes stay out of any scandal like this!
Joe Kelly
You did a great job at touching on so many different industries that have seen ethical issues. It is crazy to think of how many businessmen think they can get away with these things. Sooner or later you will always be discovered and your life will come crashing down. You can see how big of a deal things like this are in the business world which is why ethics are discussed in some way in basically every class. People should hold themselves to a higher standard when doing business. In the case of Enron, this issue had a drastic impact on so many of the employees. One of my friend’s parents lost their entire amount of retirement money they had built up over the years working at Enron.