Klein Cedric Murvy C.

Sze

ACETHIC M71

Reflection Paper: Enron

Being the smartest guys in the room has its pros and cons. It allows
a person to think of endless possibilitiesand this what happens to
Kenneth Lay and Jeffrey Skilling. With their genius ideas, they were
able to persuade people to invest in their company, Enron. They even
formulated an Accounting system called mark-to-market accounting to
suit their companys needs. But as the saying goes, too much of
everything is bad. The downfall of Enron was one of the most shocking
news in the corporate world. It destroyed different groups such as its
auditing firm, Arthur Andersen, which was considered to be one of the
largest audit firms in the world. The scandal led SEC and other
regulatory board to create a standardized accounting system and the
Sarbanes-Oxley Act to improve corporate accountability.

One of the main reasons why Enron failed is because of the greed
of its leaders. I think there are 2 kinds bad people in the world, first, the
people doing badly to others, and second, the good ones who know
people who does bad things to others but chose to keep their mouth shut.
In my opinion, the issue here is honesty. Most of us were raised with a
sense of ethics. Our parents taught us how we should act. In preparatory
school, our teachers taught us GMRC. And for many of us who went to

Catholic school, we have subjects about religion and other teachings of

God. But it also seemed that those learning get lost in real-life.

To create a long-lasting company, we must have principles to

follow. Each employee is responsible for his action. He must think not
only for his self-interest but also for the betterment of the whole. They
said that everything has come to an end but isnt it better to end with a
legacy than shame? This is why we are studying ACETHIC, so that we
learn from the mistakes of companies such as Enron, Each of us must
create a just and ethical corporate culture.

In todays world, its not just about profits; there are several factors
that contribute to the success of a company which include corporate
social responsibility, ethics, sustainability, etc. A company with strong
ethical standards will make employees want to stay longer with the
business, which in turn reduce labor turnover, therefore increasing
productivity. It also attracts investors and keeps the companys share
price high. Lastly, it attracts customers to the companys products,
thereby boosting sales and profits. As Richard Rudden, managing
partner at target Rock Advisors said, Ethics and integrity are the core of
the sustainable long term success.