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Ethics Study Reveals Enron Effect


June 13, 2006 (SmartPros) "Enron" as a symbol of corporate greed and scandal entered mainstream American culture in 2001. Five years later, the results of a national business ethics study show a dramatic increase in employee opinions on company integrity.



Global employee research and consulting firm ISR's study, based on surveys of more than 200,000 U.S. employees, examines issues of integrity, social responsibility and company values.
 
"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 landmines to determining how to make improvements before a crisis occurs," said ISR Executive Director Adam Zuckerman.

Among its findings, ISR's national business ethics study examines the impact the media attention on corporate ethics scandals has had on U.S. employees. From 2001 to 2005, the study found that employee opinions on company integrity increased a dramatic 11 percent from 2001 to 2005.

This trend is not isolated. U.S. employee awareness of corporate integrity, social responsibility and corporate ethics issues have all increased since 2001, according to ISR data.

Other study findings include a 7 percent increase since 2001 in positive employee opinions across the U.S. to the statement, "My company is socially responsible in the community."

Nationally, employee perceptions of internal corporate values increased from 78 percent in 2001 to 82 percent in 2005. Likewise, perception of management's consistency with stated internal values has increased from a 60 percent positive response in 2001 to 65 percent in 2005.

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

2006 SmartPros Ltd. All rights reserved.

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