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Full-Text Articles in Law
Placebo Ethics, Usha Rodrigues, Mike Stegemoller
Placebo Ethics, Usha Rodrigues, Mike Stegemoller
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While there are innumerable theories on the best remedy for the current financial crisis, there is agreement on one point, at least: increased transparency is good. We look at a provision from the last round of financial regulation, the Sarbanes Oxley Act of 2002 (SOX), which imposed disclosure requirements tailored to prevent some of the kinds of abuses that led to the downfall of Enron. In response to Enron's self-dealing transactions, Section 406 of SOX required a public company to disclose its code of ethics and to disclose immediately any waivers from that code the company grants to its top …
Enron, Titanic, And The Perfect Storm, Nancy B. Rapoport
Enron, Titanic, And The Perfect Storm, Nancy B. Rapoport
Scholarly Works
This article explores the contention of Jeffrey Skilling, former Enron CEO, that Enron's debacle was due to a perfect storm of events. It rejects his contention, arguing instead that Enron's downfall was more like Titanic's - hubris and an over-reliance on checks and balances led to Enron's downfall. The article then explores how character (especially of those at the top of an organization) can lead to Enron-like disasters, and discusses how cognitive dissonance can lead to very smart people making very stupid decisions. It ends with some musings about how lawyers can learn from Enron.