Has Enron Made Companies More Ethical?

There has been a dramatic five-year increase in how employees perceive their company’s ethics, according to a new national business ethics survey from global employee research and consulting firm ISR. [1]

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“After the SEC began investigating Enron’s accounting scandal in 2001, ISR documented an increased interest in better understanding the role ethics plays in a company’s culture, from identifying potential land mines to determining how to make improvements before a crisis occurs,” ISR Executive Director Adam Zuckerman said in a prepared statement.

The study, which is based on data gathered from more than 200,000 U.S. employees and examines issues of integrity, social responsibility and company values, found that employee opinions on company integrity increased a dramatic 11 percent between 2001 to 2005. The findings show that American employee awareness of corporate integrity, social responsibility, and corporate ethics issues have all increased since 2001.

The study’s results indicate:

• The number of employees responding positively to the statement “My company is socially responsible in the community” has increased by 7 percent since 2001.
  
• Employee perceptions of internal corporate values increased 4 percent, to 82 percent in 2005.
  
• Perception of management’s consistency with stated internal values has increased 5 percent, to 65 percent in 2005.

“Overall, these figures show there is reason to be optimistic about the improving state of ethics in corporate America,” Zuckerman said. “Knowing where to focus your efforts is half the battle, and companies are clearly paying more attention to ethics.”