On business, money and morality: have we learned nothing?
In corporate South Africa, we seem to be in Enron territory again
Say “Enron” and memory takes us back to one of the most well-known symbols of reputational meltdown of modern business. Once hailed by Fortune magazine as the most innovative US company for six consecutive years, it eventually filed for bankruptcy in 2001 at the cost of 20,000 jobs, jail sentences for executives and the dissolution of the accounting firm Arthur Andersen. Several lessons stand out from the Enron scandal. Directors, managers and accountants must stick to their roles and stay independent of mind. There is no excuse for bad governance. The relationship between money and morality should be carefully managed. Reputation is priceless. Society is not stupid. Truth prevails. But do we learn? In corporate South Africa, we seem to be in Enron territory again. In a society inundated by scandal after scandal, we observe how boards ignore early warning signals and forsake their fiduciary duties. We hear executives swear by the truth only to be eventually exposed for their lies...
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