Friday, May 26, 2006

Enron: Responding to a crisis

Convictions of Lay and Skilling offer another case study in business ethics

The corporate powerbrokers behind one of the largest financial scandals in U.S. history face the prospect of at least 25 years in prison after being convicted of fraud, conspiracy and insider trading.

Kenneth Lay, former chairman of Houston-based Enron Corp., and his chief executive, Jeffrey Skilling, were found guilty Thursday of dozens of charges in connection with the 2001 collapse of the energy giant that wiped out $68 billion in share value and eliminated the jobs of 5,600 people.

Scatterbox publisher Steven Silvers reflects on this story from a crisis management perspective.

Silvers writes, "For chief executives everywhere, the convictions of Enron chiefs Lay and Skilling prove again that the cost of a crisis is ultimately determined by your reaction to it."

To read the entire post, click here.

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Dr. Deborah Serani said...

I thought if Martha Stewart was found guilty on her business dealings, surely these men would be found guilty as well. I believe there was a crisis, one that was created by greed.....and the fallout that occurred could not be offset. So many hard working families have lost so much as a result. I am going to read the scatterbox link now.

Great post!!

Deb S. said...

Dr. Deb: I couldn't have said it better. I think you'll like Scatterbox. The site offers a wealth of information.

Alina said...

It is always so revolting to hear of so many people loosing their jobs. I've seen it happening, for different reasons and different types of fraud, yet I still think each time about how awful it must be to suddenly wake up to being unemployed.

Deb S. said...

Alina: In my opinion, the Enron case was especially cruel since so many employees also lost their life savings. I think your word - "revolting" - fits the bill here.

NewYorkMoments said...

Hmmmm, business ethics? Isn't that an oxymoron?

Deb S. said...

NYM: Aren't we jaded! LOL Thanks for stopping by.