Business Ethics After Enron: Corporate Scandals and Reform
This paper examines the state of business ethics in the 21st century through the lens of high-profile corporate scandals, particularly Enron and WorldCom. It explores the tension between the persistence of unethical business practices and the call for greater corporate accountability. Drawing on perspectives from economist Milton Friedman and other experts, the paper considers whether the Enron scandal produced meaningful ethical reform or merely superficial change. It also addresses the role of business-ethics education, the cultural normalization of greed, and the argument that lasting ethical change must begin well before the university level.
- Introduction: Business Ethics Under Scrutiny: Enron and WorldCom redefine corporate ethical failures
- The Persistence of Unethical Practices: Cynical view that business success requires corruption
- Consequences of Corruption: The Arthur Andersen Case: Arthur Andersen collapses after enabling Enron fraud
- The Culture of Greed and Whistleblowing: Greed normalized; lone whistleblower Watkins ignored
- Milton Friedman on Ethics in Business and Education: Friedman argues ethics must be taught before university
- Conclusion: Makeup on the Face of American Business: Scandal raised awareness but changed little fundamentally
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What makes this paper effective
- The paper uses concrete, well-known corporate cases (Enron, WorldCom, Arthur Andersen) as anchors for broader ethical claims, grounding abstract arguments in recognizable real-world events.
- It incorporates expert voices — economist Milton Friedman and academic critics — to present multiple perspectives rather than a single viewpoint, adding intellectual credibility.
- The closing metaphor ("put a little more makeup on the face") is memorable and effectively summarizes the paper's skeptical thesis about the depth of ethical reform.
Key academic technique demonstrated
The paper demonstrates the use of counterargument and concession: it acknowledges that business ethics have received more attention post-Enron, but consistently returns to evidence suggesting this attention has not produced substantive change. This back-and-forth structure strengthens the overall argument by showing awareness of opposing views.
Structure breakdown
The paper opens by framing business ethics as increasingly scrutinized. It then examines whether unethical behavior is inherent to business survival, uses Arthur Andersen as a cautionary example, addresses the cultural normalization of greed and the failure of internal whistleblowing, and closes with Friedman's argument that ethical reform must start in early education — not business school.
Introduction: Business Ethics Under Scrutiny
Business ethics are under increased scrutiny in the 21st century. Companies like Enron and WorldCom have redefined corporate business ethics — and the consequences of abandoning them — demonstrating what happens when greed prevails over integrity. Business ethics today may be questioned in many areas, but these scandals have caused people to take a closer look at ethics in business and to seek new ways to thrive without compromising ethical standards.
The Persistence of Unethical Practices
To say that every business in America was ethically corrupt after the Enron scandal would be as far from the truth as saying that every business in America straightened up its ethics after the scandal broke. There will always be unethical businesses in America, and there will always be highly ethical ones. However, the evidence suggests that many people believe businesses must be inherently corrupt in order to survive, thrive, and grow.
One ethics expert argues that this attitude trickles down into education, subtly continuing the trend toward unethical business practices that eventually become accepted and widely used. He writes, "This pervasive view [...] that successful businesses are by their very nature corrupt is itself corrupting to students in business-ethics classes" (Berlau & Spun, 2002). This view — that business ethics courses are teaching a cynical picture of commerce — is held by many in both the educational and business worlds. The continued reliance on "cooked" books may indeed indicate that generations of business majors have come to believe that ethics and business simply do not go together if a company wants to survive.
References
Berlau, J., & Spun, B. (2002, March 18). Is big business ethically bankrupt? A boom in business-ethics courses is likely in the wake of the Enron scandal, but critics say these classes need to focus on moral rather than political correctness. Insight on the News, 18, 16+.
Hunkin, J. S. (2002, September/October). Ethics in business and everyday life. Canadian Speeches, 16, 64+.
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