New User Special Price Expires in

Let's log you in.

Sign in with Facebook


Don't have a StudySoup account? Create one here!


Create a StudySoup account

Be part of our community, it's free to join!

Sign up with Facebook


Create your account
By creating an account you agree to StudySoup's terms and conditions and privacy policy

Already have a StudySoup account? Login here

Business Ethics: Notes on Enron Movie

by: Lindsay Fialli

Business Ethics: Notes on Enron Movie PHL 203

Marketplace > Salem State University > Philosophy > PHL 203 > Business Ethics Notes on Enron Movie
Lindsay Fialli

Preview These Notes for FREE

Get a free preview of these Notes, just enter your email below.

Unlock Preview
Unlock Preview

Preview these materials now for free

Why put in your email? Get access to more of this material and other relevant free materials for your school

View Preview

About this Document

These are the notes I took both while watching Enron: The Smartest Guys in the Room and from when we talked about them in class.
Business Ethics
Dr, Krishna Mallick
Class Notes
business, ethics
25 ?




Popular in Business Ethics

Popular in Philosophy

This 3 page Class Notes was uploaded by Lindsay Fialli on Thursday October 6, 2016. The Class Notes belongs to PHL 203 at Salem State University taught by Dr, Krishna Mallick in Fall 2016. Since its upload, it has received 7 views. For similar materials see Business Ethics in Philosophy at Salem State University.


Reviews for Business Ethics: Notes on Enron Movie


Report this Material


What is Karma?


Karma is the currency of StudySoup.

You can buy or earn more Karma at anytime and redeem it for class notes, study guides, flashcards, and more!

Date Created: 10/06/16
Notes on Enron: The Smartest Guys in the Room Movie  Enron fell quickly o Went bankrupt in 24 days  The unethical situation happened because of pride and greed o Always being hungry for more; never satisfied  The Effects of the Enron Scandal o 20,000 employees lost their jobs o 2 billion dollars worth of retirement and pension funds disappears  Before this happened, there was the Vahalla Case, or the Enron Oil Scandal o Rogue traders of Enron Oil were making profits that no one understood where they were coming from o The rogue traders gambled away all of Enron Oil's reserves, which was 90 million o The rouge traders were Mastroeni and Borget  They overlooked what they were doing because they were the company's biggest money makers  Also took money from the company and put it in off shore accounts o Ken Lay claims that he knew nothing about it  The Enron company starts out with Ken Lay o A man that was ambitious to make himself wealthy o Used the deregulation of the energy business to make money o Has a close relationship with the Bush family, especially George W. Bush, who promotes Enron and helped them make a profit  Enron was the biggest donator to George W. Bush's presidential campaign  Jeff Skilling enters as the savior that will make the company money  Skilling turns the energy industry into an industry of trading and stocks in order to make money o Recreates the entire industry and is seen as a visionary for doing so o Gain Mark to Market Accounting Treatment  Allows Enron to tell the public whatever they want in regards to their profits  Skilling is a risk taker and a gambler that also supported the idea of survival of the fittest o Believed money was the only thing that mattered  Skilling creates the PRC Process (Performance Review Committee), which rates employees based on how well they follow the values and objectives of Enron o If you weren't good enough, you were fired o 15% of employees were fired per year  Lu Pi was head of Enron Energy Services o Only cared about money and spending money on strippers o Charged money for strippers on Enron's accounts o Sells all his stocks (about 100 million) and disappears to Colorado  Stock market is significantly increasing  Enron executives are receiving bonuses for profits that do not exist o Was giving fake information to stock analysts  Enron enters the broadband business with a partnership with Blockbusters  Forbes reporter Bethany McLean looks at Enron's financials and sees that things don't add up o Starts asking questions about how Enron is making their money  Is called unethical by Enron executives saying it is unethical to print a story without all the facts  Andy Fastow, one of Enron's chief financial officers, leads Enron to fraud o Fastow was the one in charge of covering up the lack of profits o Was pressured to keep Enron's stock price up o Made Enron's debt disappear o Makes 45 million by having the company invest in fake companies that he created  Such as LJM o Was the one who made all the decisions about the transactions between Enron and LJM  Conflict of interest o Used Enron stock as colladoral when gambling  All of the banks that did business with Enron knew what was really going on but said nothing about it because they were being paid-off o Also help Enron cover up what they were really doing  Tim Beldon was tasked with looking for loopholes in the energy deregulation laws of 1996 o Come up with a plan to use California to make a profit  Enron would contact power plants in California and tell them to shut down the grid for a few hours or otherwise sabotage California's power plants so that the price of energy would go up and Enron could make a profit o Enron made a 2 billion dollar profit  There was a year of frequent blackouts in California o They had a sufficient amount of energy to begin with o Cost California 30 billion o California looked to the government to help regulate the price of electricity  Bush is president so the government refuses to intervene  FERK- federal energy regulators refuse to help as well  Cliff Baxter, a friend of Skilling's, commits suicide after cashing out his stocks  After a while Enron stock begins to fall and Skilling steps down from CEO August 2001 o Sold all his stocks, was one of the biggest shareholders o Continued to tell employees to invest in Enron stock as he was pulling out  Ken Lay takes over as CEO  Sharon Watkins realizes what has been happening and goes to the government o SEC starts an investigation o Arthur Anderson starts to shred all their Enron files o CEOs claim that they did nothing wrong o Lay reassures everyone that Enron is going fine  Enron declares bankruptcy on December 2, 2001  When biggest shareholders all cash out their stocks because they know the company is failing but don't tell anyone else is insider trading  Some thought it was politically motivated because of Lay's connection to President Bush Were the Enron executives actions' immoral in the view of Egoism?  No, because they were not thinking of their or anyone else's long-term interest  Were selfish  Pi is an example of ethical egosim because he was looking out for his long- term self-interests and got himself out before it started to fall apart  Doesn't make his actions moral Enron Corporate Culture  Cut-throat; do anything to get ahead  An example of this is the rating system  Main goal of the company was to make a profit no matter the cost  Encouraged their employees to take risks  Didn't allow anyone or anything to get in their way  An example of Kantism (using people as objects to be taken advantage of)  Keep your mouth shut and don't ask questions


Buy Material

Are you sure you want to buy this material for

25 Karma

Buy Material

BOOM! Enjoy Your Free Notes!

We've added these Notes to your profile, click here to view them now.


You're already Subscribed!

Looks like you've already subscribed to StudySoup, you won't need to purchase another subscription to get this material. To access this material simply click 'View Full Document'

Why people love StudySoup

Steve Martinelli UC Los Angeles

"There's no way I would have passed my Organic Chemistry class this semester without the notes and study guides I got from StudySoup."

Anthony Lee UC Santa Barbara

"I bought an awesome study guide, which helped me get an A in my Math 34B class this quarter!"

Steve Martinelli UC Los Angeles

"There's no way I would have passed my Organic Chemistry class this semester without the notes and study guides I got from StudySoup."


"Their 'Elite Notetakers' are making over $1,200/month in sales by creating high quality content that helps their classmates in a time of need."

Become an Elite Notetaker and start selling your notes online!

Refund Policy


All subscriptions to StudySoup are paid in full at the time of subscribing. To change your credit card information or to cancel your subscription, go to "Edit Settings". All credit card information will be available there. If you should decide to cancel your subscription, it will continue to be valid until the next payment period, as all payments for the current period were made in advance. For special circumstances, please email


StudySoup has more than 1 million course-specific study resources to help students study smarter. If you’re having trouble finding what you’re looking for, our customer support team can help you find what you need! Feel free to contact them here:

Recurring Subscriptions: If you have canceled your recurring subscription on the day of renewal and have not downloaded any documents, you may request a refund by submitting an email to

Satisfaction Guarantee: If you’re not satisfied with your subscription, you can contact us for further help. Contact must be made within 3 business days of your subscription purchase and your refund request will be subject for review.

Please Note: Refunds can never be provided more than 30 days after the initial purchase date regardless of your activity on the site.