Ethical Dilemas: Nike & Enron

Today, more than ever before, American companies are held under a microscope by society and the media. Globalization and the continuous advances in technology have allowed for a wider spectrum of information available to anyone and everyone, thus bringing greater awareness to the public. This microscope held over the companies, forces them to act not only within the obligations of the law, but also with a sense of ethics, and social responsibility. A quick browse on any major company’s website will reveal content on social and ethical responsibility. Their main goal is to establish a trust relationship with the customer. However, due to repeated scandals in the past fifteen years, the general public is increasingly skeptical, especially with banks, and other large institutions (Porter).

There was a time, not too long ago, where the microscope held over the American companies, were not at its most magnified levels, and businesses went on to carry many shady practices. Two of America’s largest companies in the 1990’s were Enron and Nike. History shows that they went on to lead completely different paths; but for awhile they had one thing in common: Lack of ethics. Enron, which in the year 2000 was the seventh largest company in the U.S., was involved in one of the largest accounting scandals in the history of this country. They managed to go from close to ninety dollars per share in late 2000, to less than one dollar per share a year later. Nike on the other hand, found themselves in a human rights controversy mid 1990’s, which focused on the extremely poor working conditions of factories linked to Nike contractors in countries such as China, Japan, and most importantly Indonesia. These so called “sweatshops” brought immense negative publicity to Nike, who had to act fast in order to save the image the company had worked so hard to build.

It is probably impossible to pinpoint the exact cause of Enron’s collapse. It was a combination of unfortunate accounting...