Enron & Sox Corporate Governance Essay Example | Topics and Well Written Essays - 1500 words

Enron & Sox Corporate Governance - Essay ExampleThe evidence adduced from the different case studies point to the fact that the caller sought to build a false image of growth and performance in order to give an impression about its stature, which would be used to deceive the shareholders (Hanilton, 2003). The deliberate manipulation of the companionships balance sheets was meant to sustain its image as one of Americas rapidly growing companies that had stepped out of the conventional ways of doing business to subscribe new and revolutionary practices that were apparently effective (Topping, 2005). Various factors played together towards the eventual collapse of the buckram. Many of these forces were structural while others were strategic (Topping, 2005). Other analysts defy pointed to the fact that the macro-economic and micro-economic factors contributed to the eventual collapse of the firm. It might be argued that some of the actions and strategies initiated by the different m anagers of the firm eventually developed into multiple challenges that led to the collapse of the firm (Hanilton, 2003). Market forces, cultural differences, financial strategies and other factors worked together to contribute to factors that systematically brought down a firm that analysts had endorsed as a model of growth. Fraud and indoors Trading Under the stewardship of Jeff Skilling, Enron manipulated its accounting records so that they did not reflect its liabilities (Hanilton, 2003). ... Critics have often pointed at this as acts of intimidation and outright unprofessionalism. Through such practices, the company sued several lawyers and the media, which attempted to reveal the true nature of the company (Kluyver, 2009). Another feature of corruption in the company involved the posting of profits and losses in entities that were off-shore. There was as well as the deliberate concealing of affiliate firms that made losses while only including those firm that were fairly suc cessful. As such the consummate financial position of the company was a misrepresentation of facts. From another dimension, there was rampant inside trading at the company. The management of the company gave away hidden and privileged information to firms that had special relation to Enron and other firms that were related to the management (Hanilton, 2003). As a result of these preferential inside trading practices, Enron had adverse make on trading practices of the American corporate sector. Analysts have pointed out that the culture of Pride, arrogance and intolerance were to blame for the managerial challenges and unprofessional conducts that affected Enron (Gibney, 2005). According to the selfsame(prenominal) analysts it took sixteen years to build their assets from 10 to 65 billion but only 24 days to go bankrupt. The culture of managerial arrogance was also attributed to the fact that most of the personnel at the institution were former nerds, and that they sought popular ity by compromising on ethics and professionalism to achieve their goals. While stepping out of the tralatitious forms of business management and organizational strategies, the firm did not adequately engage with the internal challenges of dissent and the cultural challenges of initiating new