MGM101H5 Lecture 6: Chapter 6
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MGM101H5 Full Course Notes
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Document Summary
Enron was formed in 1985 with the merger of internorth and hng, two natural gas companies. Ethics and the individual complex derivatives and enterd into many seemingly unrelated lines of business. Ethics reflect the moral principles or beliefs about what individual views as being right or wrong. Ethics can be businesses turned out to be unprofitable. Perhaps in part due to a pay structure that was heavily weighted toward thought of as an invisible hand that guides each of us as we make decisions. Ethics is so personal with respect to option-based compensation, enron mgm appeared to have felt an extraordinary pressure to increase the company"s assessing the ethical boundaries within which individual will operate. For some ethics is based soley on legality, for others its about fairness. Andersen llp, enron"s auditor and consultant, allowed its dependence on its biggest client to get the better of it as it plays into questions relating to ethics.
