Managerial betrayal: justifying the punishment of Enron’s management

Abstract

Few interested in corporate affairs can have missed the demise of Enron. The case involved hugely complex transactions designed to appease regulators, analysts and shareholders; and corporate governance, risk management and internal control were sacrificed in favour of profitability and growth. In this paper Ten’s (1987) theory is used to illustrate the benefit of a combined utilitarian and retributive model for justifying the punishment of Enron’s management. Throughout, the study makes both practical and theoretical observations.