The Fall of Arthur Andersen - The Fall of Arthur Andersen -...

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Unformatted text preview: The Fall of Arthur Andersen - Organizational Culture Issues Arthur Andersen's culture popularly known as the 'Andersen Way' made it one of the leading consulting firms in the world. The 'Andersen Way' represented a culture of integrity and ethics in business. This is an American tragedy. For decades Andersen was renowned as the company that could say no to a client, but somewhere along the way, Andersen became a firm that could not say no to a client, and in fact said, 'how can we help you do it.'"- An article on http://news.bbc.co.uk, July 2002. "This growing split was one of the key elements transforming the firm's tight-knit, proud culture, into one filled with paranoia, jealousy and rage. A Shamed Company In March 2002, one of the world's leading auditing firms, Andersen (previously Arthur Andersen), was indicted by the US Department of Justice (DOJ) on charges of obstructing the course of justice. The company was blamed for hampering DOJ's investigations in the on-going Enron case. 1 Andersen was accused of deliberately destroying evidence (by shredding many Enron-related documents), while the US Securities and Exchange Commission (SEC) was investigating the numerous charges. Ever since DOJ had begun a criminal investigation of Andersen in early January 2002, the firms' employees and partners expected the firm to reach an outside settlement with DOJ. The firm had even roped in Paul Volcker, a former Federal Reserve Chairman, to set things right and restore its reputation. Thus, the indictment came as an unexpected and severe blow to the firm. DOJ's investigation revealed that Andersen had indeed shredded Enron-related documents during October 2001 and early November 2001, even as SEC's probe at Enron was underway....
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The Fall of Arthur Andersen - The Fall of Arthur Andersen -...

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