Creditors Recovery Insolvency

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Collaborative Learning Community: Public Relations Campaign

About the company

Enron Creditors Recovery Corporation is a company that is highly involved in publicized scandal. The company was originated in the year 1985, in Omaha, Nebraska. It is an American energy company based in Houston, Texas. The management of the company consists of S. F. Cooper, as the temporary CEO and CRO and J. J. Ray III, as the Chairman of the company (Fusaro & Miller, 2002). Fortune magazine named Enron as the America's most pioneering company, for consecutive six years i.e. from the year 1996 to 2001. At the end of 2001, it was revealed that its reported financial condition was sustained by systematic and creative planned accounting fraud. It had become a popular symbol of determined corporate fraud and corruption (Fusaro & Miller, 2002).

In the Southern District of New York, Enron filed for insolvency protection in year 2001 and selected Weil, Gotshal & Manges as their bankruptcy advocate. Enron Corporation was highly praised by the labor and the workforce as a great and large company. Its workers praised the company for its long-term pensions and other benefits scheme (Fusaro & Miller, 2002). The Enron Company operates in more than 30 different products like Petrochemicals, Plastics, Power, Pulp and paper, Oil & LNG Transportation, Broadband, Steel & Weather Risk Management, etc (Swartz & Watkins, 2003).

Enron Scandal:

The Enron Company scandal was a financial scandal between Enron Corporation and its accounting firm, Arthur Andersen. The scandal was revealed in the year 2001. Enron shares were dropped from US$90.00 to some pennies when the scandal was revealed (The Enron Scandal (Slides), 2007). It was revealed that a large amount of its profits and revenues were the result of deals with special purpose entities. The scandal was an incomparable and devastating event in the world of finance. In the financial statements, the company Enron had not reported its debts and the losses that it suffered (The Enron Scandal (Slides), 2007). The scandal also caused the dissolution of its accounting firm. The company was involved in the widespread corruption and questionable accounting practices (Wheelen & Hunger, 2005).

Offsetting the negative image

To offset the negative image, Company should promote a positive reflection and develop the high-quality goodwill and image among the society and customers (Wheelen & Hunger, 2005). The company should find its stakeholders like investors, suppliers, financial institutions and government. To restore the credibility, the focus should be on the public interest and image building (Gallup, 2003). To meet the objective of the company, Enron should: undertake local charities and sponsor the various sports activities. The company should involve in activities, which show that there is a commitment towards the community (Wheelen & Hunger, 2005). The company should also fulfill the social responsibility.

Corporate Image

Enron has made various efforts to protect the environment. The organization is supported by various environmental groups. In Houston, the company has made contribution to health care centers, museums, etc. Enron is a fair firm and has won many environmental awards (Gallup, 2003). Environmentalist praise is won by the firm as it fought for regulations related to environment. Enron has fulfilled its responsibility towards the society and is a trustworthy company.

Future plans

The company is interacting with the society, draw resources there from and transmit products and services thereto. In fact, they draw their support and sustenance from society. Their relationship with and role in society can be sustained only through a socially responsible behavior: they must not damage the society as no branch can live if the tree dies. Assumption of a set of social obligations by business is an integral element of ethical conduct of business. Social obligations form the part of ethical and moral obligations of business (Gallup, 2003).

Business enterprises are not mere money-making machines. Management will show tremendous initiative and imagination in economic matters. The company will prove its competence and leadership in achievement of economic goals. Society has also a right to expect from corporate management a measure of involvement, initiative, support and contribution in solving some social problems. Inclusion of social responsibility as a corporate objective is a recognition of the leadership role of business (Wheelen & Hunger, 2005).

The company is imbued with a social spirit & responsiveness and considers both commercial and social implications of alternative courses of action while making economic decisions. When corporate goals are tempered with social goals and obligations, economic strategies, policies and action plans should be formulated in such a way that social and public interest criteria is observed. Enterprises have to be concerned with the social consequences of their economic decisions (Ramaswamy & Namakumari, 2005).

As the economic agents of society for deployment and utilization of economic resources, business enterprises are responsible to society to understand the nature of economic power they command, to recognize the limits of their power and to exercise the power with restraint so as to promote the social good, uphold public interest and preserve social values. Such responsibility is too being assumed on a voluntary basis in a gracious manner for the genuine benefit of the society. It should not be treated as a mere responsiveness to social demands, pressures, needs and aspirations of various interest groups (Ramaswamy & Namakumari, 2005).

References

12 steps to a successful PR campaign. (2006). Retrieved April 24, 2008, from http://www.prblogger.com/2006/06/12-steps-to-a-successful-pr-campaign/

Fusaro, P.C & Miller, R.M. (2002). What Went Wrong at Enron: Everyone's Guide to the Largest Bankruptcy in U.S. History. By Wiley.

Gallup, J. (2003). The Gallup Poll: Public Opinion 2002, Published by Rowman & Littlefield

How to Establish a Public Relations Campaign. (2007). Retrieved April 24, 2008 from http://www.esmalloffice.com/SBR_template.cfm?DocNumber=PL12_3000.htm

Kazmi, A. (2002). Business Policy and Strategic Management. New Delhi: Tata McGraw Hill.

Ramaswamy, V.S & Namakumari, S. (2005). Strategic Planning Formulation of Corporate Strategy. New Delhi: Macmillan India Ltd.

Swartz, M. & Watkins, S. (2003). Power Failure: The Inside Story of the Collapse of Enron by Doubleday

The Enron Scandal (Slides), (2007). Retrieved April 24, 2008 from http://papers.ssrn.com/sol3/papers.cfm?abstract_id=991044

Wheelen, T.L. & Hunger, J. D. (2005). Strategic Management and Business policy, (4th Edition). New Delhi: Pearson Education Inc.

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