MEMO
TO: Prof. Kaitlin Flaherty
FROM: Ali S. Ibraheem
DATE: September 7, 2015
SUBJECT: Enron Bankruptcy
Introduction
Enron bankruptcy and the final collapse can be traced to three key ethical issues. These issues are
as a result of poor management practices and irresponsibility which led to the demise of the
company. I will also focus on the roles that the senior management played to the collapse of the
organization.
Background
Enron Corporation was one of the most respected organizations not only in the United States but
also in the world. It was seen as having provided a great number of employments and services as
well as practicing exceptional skills at its management level especially the financial leaps it
made. But things turned into their worse when it went down in a year’s time. This indicated that
something was terribly wrong.
Ethical issues
One of the ethical issues Identified in the documentary was the inflating of the balance sheet. It
was noted that Enron would acquire loans from the banks and use the same funds to repay other
loans as well as to boost their massive investments in which they anticipated no risks. This
mainly affected the integrity of the corporation’s management. From the documentary it is also
noted how the senior managers would mistreat the employees by ranking them, and finally
sending home a fifth of those who ranked at the bottom. This was mainly practiced in order for
the senior management to establish themselves within their positions in the organization. This
affected the issue of respect to the low ranked employees in which they were not offered an
