Antecedents and consequences of failed governance: the Enron example

Meredith Downes (Associate Professors of Management, Department of Management and Quantitative Methods, Illinois State University, Normal, Illinios, USA)
Gail S. Russ (Associate Professors of Management, Department of Management and Quantitative Methods, Illinois State University, Normal, Illinios, USA)

Corporate Governance

ISSN: 1472-0701

Publication date: 1 December 2005

Abstract

Purpose

The purpose of this paper is to examine the demise of Enron, one of the most curious aspects of which was that on the surface it appeared to be thriving, giving no one any cause to question the company's governance structures.

Design/methodology/approach

The paper provides a detailed analysis of the composition of Enron's board of directors, demonstrating how directly observable traits are not the sole determinants of effective corporate governance.

Findings

The paper finds that collectively, the board's qualifications are less overt, and even more elusive are the ethics and morals that drive the governance process.

Originality/value

This case illustrates how ethics and morals are necessary, but that none is sufficient, to deter poor governance, and also underscores the far‐reaching impact of Enron's moral deficiencies.

Keywords

Citation

Downes, M. and Russ, G. (2005), "Antecedents and consequences of failed governance: the Enron example", Corporate Governance, Vol. 5 No. 5, pp. 84-98. https://doi.org/10.1108/14720700510630077

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Publisher

:

Emerald Group Publishing Limited

Copyright © 2005, Emerald Group Publishing Limited

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