Abcd12345 Essay

15924 Words Sep 19th, 2014 64 Pages
FROM GREAT TO GHASTLY: HOW TOXIC ORGANIZATIONAL CULTURES POISON COMPANIES THE RISE AND FALL OF ENRON, WORLDCOM, HEALTHSOUTH, AND TYCO INTERNATIONAL David R. Lease, Norwich University Abstract This paper presents an analytical and comparative study of four recent corporate scandals involving organizations that had previously been recognized as both ethically and organizationally sound. Based on these case studies, the following issues are discussed: (1) The role of leader behavior and organizational/leadership styles in shaping the corporate organizational culture of an organization, and (2) The extent to which this culture renders the organization and its members (including the top executives) prone to ethical misbehavior. The four …show more content…
Wall Street analysts were particularly enamored of WorldCom Chief Financial Officer (CFO) Scott Sullivan, the man who engineered the WorldCom--MCI takeover and who was widely viewed as “the key to WorldCom Inc.’s financial credibility” (Young & Perez, 2002, p. B1). In 2002, four years after brokering the historic WorldCom/MCI deal, Sullivan was fired from WorldCom and named by prosecutors as the chief architect in what was ultimately revealed to be a $11 billion accounting fraud (the world’s largest), leading to the biggest Chapter 11 bankruptcy filing in U.S. history (Young, 2005, p. C3). Before it collapsed in fraud, scandal and bankruptcy in late 2001, Enron had been named “America’s most innovative company” six times in a row (McLean & Elkind, 2003, p. xxiv). Enron’s CEO, Kenneth Lay, was regularly lionized in the business press. Although it would eventually be learned that the company’s 1,000% return to investors was little more than the accounting fraud, only few firms were as much adored by Wall Street as Enron was in the late 1990s (Sridharan, Dickes, & Caines, 2002). Lambasted in the press in 2003 – 2004 for spending $2 million of his company’s money on a lavish birthday party for his wife, former Tyco CEO, Dennis Kozlowski, was once appreciatively dubbed “The Most Aggressive CEO” and talked about “as a second Jack Welch”

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