The movie Enron is depicted from the book, “The Smartest Guys in the Room” and it elaborates on the Enron crisis that left most investors and employees at the losing end while the top executives of the company left with over one billion dollars. The movie reveals most of the concepts that are explained in the book and shows the mistakes that led the company to its downfall. The film also features some of the personal overindulgences of the Enron chain of command and the sheer moral decay that presented itself as a corporate philosophy (McLean Bethany and Peter 24). The way through which the traders profited out of the Californian energy crisis is also portrayed.
The moral theory upon which the parties seem to have relied to justify their actions is through setting up partnerships and using them to generate imaginary revenues and burying its losses. A good example of this is when the Enron Company invested an enormous amount of money in a joint project with Blockbuster to rent out movies online. However, the deal collapsed eight months later leaving the company at a huge loss. Meanwhile, Enron had set up a secret partnership with a Canadian bank, therefore; the bank lent the company one hundred and fifteen million dollars in exchange for the profits that they will make from the movie venture over the first ten years. So when the Blockbuster deal was at a huge loss, the Enron Company had the Canadian loan as a huge benefit from the deal. The failures of the company were always hidden in places like offshore trusts, companies, and other illegal partnerships. However, the truth came out, and the confidence in the company reduced leading it into bankruptcy (McLean Bethany and Peter 76). Integrity is one of the philosophies that would have resulted in a different outcome of the Enron crisis. Most of the executive leaders lacked this trait. The lack of integrity was a severe disadvantage for the culture and the organizational formation of the business. For example, Jeffrey Skilling’s leadership style was impeccable, but the maximization of profit was extremely done in such a way that it discharged the right value of integrity within the company. Andrew Fastow was also another example of the lack of this philosophy in the business especially when it came to the dishonest disclosure of the financial information of Enron. The transformational theory of leadership was also another opinion that lacked within the leaders of the Enron Company. Most of them concentrated more on making quick money than focusing on the values, emotions, and long-term goals of the company. The strategy of motivating the workers into accomplishing more than what they had expected was not seen. Most of the business leaders did not think of the impact that their short term personal behaviors were having on the long-term prosperity of the company and the well-being of the many shareholders, company employees and the entire American energy consumers. Had they acted according to the two philosophies, the company would not have undergone such a tremendous downfall, and many employees and investors would not have suffered the massive loss that happened.
It is, therefore, vital to note that the lack of moral values was one of the main contributors of the collapse of one of the largest energy companies in the United States. It affected many lives of the consumers and also the staff that worked in the enterprise.
McLean, Bethany, and Peter Elkind. The smartest guys in the room: The amazing rise and scandalous fall of Enron. Penguin, 2013.
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