Abstract
This article draws upon a growing body of Foucauldian-inspired literature on business ethics. Looking at the media as a prime site of dynamic discursive production in contemporary times, it offers an analysis of the underlying moral sensitivities and ethical frameworks characteristic of reports about the two top managerial figures involved in the Enron scandal: Jeffrey Skilling and Kenneth L. Lay. Analysing Forbes and BusinessWeek articles, the article examines the sudden appearance of these managers as a heightened moral threat, asking what constellations of knowledge and meaning were expressed through the demonization of these once idealized managerial superstars. It shows that while speaking in the name of ethics, the examined discourse also undermines ethics in that it promulgates a largely paradoxical and ethically incapacitating concept of self and logic of action.
Over the past two decades a group of organizational scholars have pursued the ‘“postmodern” alternative to business ethics’ (Kelemen and Peltonen, 2001: 151). Broadly speaking, this alternative does not look at individuals as coherent, stable and knowable entities whose ethical conduct can be perfected and ensured through ethical codes and prescribed courses of action. 1 Rather, postmodern business ethics scholars, and especially those influenced by the late Foucault (e.g. 1997, 1990), argue that the individual is constituted through ethics in a way that is both socially contingent and self-reflexive. According to Foucault (1997: 291), the subject actively and mindfully constitutes himself through ethical ‘practices of the self’ that are not of his making: ‘They are models that he finds in his culture and are proposed, suggested and imposed upon him by his culture, his society, and his social group’. In this framework, ‘ethics’ refers to the ways that individuals in a particular context seek to constitute themselves as moral subjects of their own actions in the context and light of the patterned, discursively constituted moral ‘truths’ and models that make these actions appropriate at a given time and place (see, e.g. Cook, 1993: 123–124; Clegg et al., 2006; Crane et al., 2008; McNay, 1994). 2
Accordingly, the Foucauldian concept of ‘ethics’ entails two interrelated dimensions (Loacker and Muhr, 2009: 268). First, it entails a focus on the discursively constituted ethical ‘truths’ and moral models of thinking. As Clegg et al. (2006: 7) assert, ‘Just as any form of practice, ethics are enacted through, and require as their precondition, a discourse that provides patterned ways of understanding and dealing with possible choices and decisions’. Second, a Foucauldian approach requires looking at the day-to-day practices and forms of conduct that are conditioned and shaped by this discourse, and that in turn condition and shape the ongoing formation of individual subjectivity in relation to this discourse (see, e.g. Chan and Garrick, 2002; Clegg et al., 2006; Crane et al., 2008; Ibarra-Colado et al., 2006; Townley, 2008).
This article is concerned with the first dimension analytically, and with the second–—from a practical aspect. Analytically, the article examines a dominant, popular and mainstream discourse on business ethics. It analyses this discourse’s underlying, taken for granted frameworks for making sense of ethical experience and reality and the collective moral ‘truths’ and models that it expresses (see Clegg et al., 2006, especially p. 7), and that, according to Foucauldian theory, condition people’s ethical subjectivity and moral self perceptions in the contemporary business context. From a practical aspect, the goal of analysing such mainstream discursive formations on ethics is as a means of facilitating reflexive and critical ‘practices of the self’. As Foucauldian business-ethics writers note (e.g. Crane et al., 2008; Weiskopf and Willmott, 2013), Foucault’s ethics promote a strategy of reflexivity through which we can potentially transform our relations to self and other. Awareness of the discursive limits and contingencies imposed upon us is thus a means of seeing in a way that enables the adoption of a reflexive and mindful subject position in organizations (see Townley, 2008). It is a way of enhancing the freedom to resist and overcome constraints imposed upon our ability to purposely constitute ourselves as active moral agents within fields of disciplinary practice (Clegg et al., 2006; Crane et al., 2008).
Existing writings on discourse and business ethics may broadly be divided into those that focus on inner-organizational discourse, and those that adopt a discursive focus that goes beyond the organizational context. In inner-organizational studies, writers locate moral subjectivities and practices of ethics within the specific organizational discursive contexts that they are embedded (e.g. Clegg et al., 2006; de Graaf, 2006, 2001; Ibarra-Colado et al., 2006; Kornberger and Brown, 2007). Such writings offer support for the claim that the ethical discourses that are in play in organizations provide ‘the means through which ethical sensemaking can occur’ (Clegg et al., 2006: 8).
Writings that expand the discursive focus imply that a fuller grasp of business ethics requires transcending the organizational universe (see Everett et al., 2006; Johnson and Smith, 1999; Randels, 1998). As de Graaf (2005: 1) states, ‘[m]anagers and their organizations are not isolated in society’. Hence, the ‘meaning of morality appears to be shifting according to what is valued in cultural or economic terms within various periods of time’ (Kelemen and Peltonen, 2001: 154). Indeed, since smaller, particular ethical worldviews and narratives operate within the structure of larger ones, it is the latter that order the world and offer the socially sanctioned standards of evaluation that condition and shape action (Randels, 1998: 1301). The knowledge that conditions ethical conduct and moral self-constitution takes form in a discursive field much greater than that of a single organization.
While there have been empirical studies about the broader business ethics discourse, only a few have sought to explore this discourse as a dynamic, evolving process, enlivened by unexpected events as well as by its own tensions and paradoxes (see Everett et al., 2006). Discourse, after all, is very much ‘alive’: it refers to dynamic and highly complex interpretive formations that are ‘in movement’ (see Ailon, 2011, 2012). So, although some business ethics researchers have offered typologies of the philosophical genres of ‘high modernity’ (Johnson and Smith, 1999) or of the broad worldview narratives characteristic of well-known business ideology streams (Randels, 1998), they have not offered an interpretive analysis of what might be termed ‘discourse in action’: of actual efforts to make sense of complex events as they unfold.
Even fewer studies have sought to examine the main arena of ‘discourse in action’: the business media. Whereas criminologists and sociologists have long since noted the media’s pivotal moral role in contemporary society, and specifically its role in the discursive constitution of events or objects as central or heightened moral threats (e.g. Thompson, 1998), researchers of business ethics discourse have generally refrained from analysing the business media (but see Hannah & Zatzick, 2008). This seems a great shortcoming, for the media is not only a prime discursive engine in contemporary times, but also a prime site within which to observe and scrutinize the underlying grammar of the discursive moral dynamic (Ailon, 2011). After all, the media does not simply or directly report events: media reports construct the meaning of events through patterned and historically contingent moral and ethical frameworks of meaning. They therefore provide an opportunity to study these frameworks in motion; to scrutinize the active constitution, negotiation and articulation of moral ‘truths’ and commonsense.
Exploring the business-media discourse, this study focuses on the Enron scandal and analyses the moral and ethical frameworks constituted and expressed through accounts of Enron’s once idealized top managerial figures: Kenneth L. Lay and Jeffrey Skilling. The focus on media representations of the doings and misdoings of specific figures involved in a corporate scandal makes this a discursive case-study of sorts. The focus is on a specific event, but one that has been extensively acknowledged as ethically meaningful: ‘No business scandal has precipitated greater interest in the ethics of business than the spectacular rise and precipitous fall of Enron’ (Willmott, 2011: 96; see also, e.g. Hannah and Zatzick, 2008). In other words, this event has been invested with explicit ethical significance and marked as carrying substantial discursive weight. As Painter-Morland (2008: 1) writes, corporate scandals, and Enron is a striking example, ‘have shaken the international business community over the last few years’ and thereby played a pivotal role in raising ethical awareness and sparking discussion.
Adopting an inner-organizational discursive viewpoint (pp. 124–127), Painter-Morland (2008: 7–8) also refers to the ‘fact that the collapse of companies like Enron and WorldCom could be directly attributed to unethical behavior’. I would like to point out the difference between such an account and the analysis pursued here. Although I accept Painter-Morland’s insistence on the ethically pivotal role of the scandals, this article’s focus on the broad, societal discourse allows us to question rather than take for granted what constitutes the ‘unethical’ in the first place. Stated differently, the aim of this article is to unveil the underlying logic and meaning-making frames that enact and sustain the ethical/unethical dichotomy, as well as the complex dynamics–—the paradoxical twists and incoherent turns–—that haunt this logic from within the discursive domain.
This article therefore regards media reports on Enron’s Lay and Skilling as an occasion on which underlying moral sensitivities and ethical frameworks became activated and manifest. As Sims and Brinkmann (2003: 243) note, the same executives who, after Enron, were depicted as corrupt, were seen not long before as leaders of a company ‘heralded as a paragon of corporate responsibility and ethics …’. Here, then, we find a dynamic of moral repositioning which offers an opportunity to examine the discursive constituents of the positive and negative business-moral extremes and the ethical space that is constituted through them. In this sense, the Enron scandal offers an opportunity to trace the dynamics of a major discursive shift as a means to the ‘ultimate aim’ (Barratt, 2008: 517) 3 of a Foucauldian-inspired analysis: de-familiarization with prevailing ethical ‘truths’.
In sum, theoretically informed by Foucauldian sensibilities, this article adopts an event-based (rather than a genealogical) perspective, and conducts an interpretive analysis of the constitution of business ethics within the context of a formative crisis. Indeed, the sharp fall of Enron’s executives from moral grace seems to constitute an ideal test case within which to observe the ideational foundations and breadth of the moral spectrum by means of which the value of managerial character and deeds is construed, codified, evaluated and transformed. While the article does not empirically explore how the examined discourse is imbibed, or not, by executives such as Skilling and Lay, it does use the discourse on Skilling and Lay to expose the discursive dynamics that configure the formulative ‘truths’ upon which the organizational actions and ethical subjectivity of such executives are to a great extent contingent.
The Enron scandal
Founded in 1985 as a natural-gas pipeline company, Enron changed forms throughout its history. It traded gas and electricity, ventured abroad to build power utilities, and, in its late years, became a dot-com, trading commodities such as financial derivatives online. By the year 2000 it had become an exemplary specimen of ‘New Economy’ thinking (Ailon, 2011: 148). Admired as a model company, Enron was ‘the subject of glowing Harvard Business School case studies’, and it starred in various business-press lists of fame (Willmott, 2011: 96, 99). In addition to its business activities, the company was involved in intense and successful lobbying (Willmott, 2011). Playing a significant role in energy deregulation, its chairman Lay was called upon to take part in policy task forces (Fox, 2003; Stiglitz, 2003). ‘Like McDonaldization and Disneyfication, “Enronization” [was] at the center of the new global economy’ (Boje et al., 2004: 766).
To help prop up stock prices, the company pursued complex accounting procedures that hid losses and shuffled debts. Many of these procedures were within the wide, deregulated American legal bounds, and actually quite standard and normal in the 1990s (Stiglitz, 2003; see also Willmott, 2011). Additionally, the company was among the suppliers and traders involved in California’s post-deregulation electricity crisis in 2000–2001 (see Fox, 2003; Stiglitz, 2003).
At the end of 2001, the SEC began investigating the company’s records. During this period, media accounts started questioning the company’s accounting statements and financial disclosure, and Enron’s stock price tumbled. Employees of Enron’s auditor, ‘Arthur Andersen’, shredded relevant documents. The accounting firm was consequently indicted by the Justice Department and eventually collapsed. Enron went bankrupt in December 2001 and its bankruptcy was the largest in history up to that time. The years since the bankruptcy have involved a series of trials and legal hearings, and in 2006 Enron’s former CEOs Lay and Skilling were criminally convicted on counts of fraud, conspiracy and related charges.
Enron’s fall in December 2001 constituted a ‘megaspectacle‘ (Boje et al., 2004); it was a long-lasting scandal that ‘rocked America’ (Stiglitz, 2003: xlii). Building up the sense that a climactic event was occurring, multiple media amplified the sense of confusion and bewilderment, evoking a heightened sense of crisis, excitement and shock. Thus, according to Williams (2008: 472), Enron’s story could be plotted in terms of causes and consequences, deeds and misdeeds, but also in terms of ‘the onslaught of articles, commentaries, and opinion pieces that followed in their wake’. As the business press presented its interpretations of the Enron scandal, much of its focus was on the leadership of the company, particularly on the role of personal ethics in the actions of its top executives (Hanna and Zatzick, 2007: 361).
These (as all) media accounts did not merely describe the scandalous events. Like all business narratives, they constructed meaning out of events; they ‘construe[d] how we do, can, or should view the world, and how business people and corporations act, can act, and should act (or, who or what they should be)’ (Randels, 1998: 1300). Indeed, as Randels (1998: 1300) further maintains, ‘[t]he very description of an act reflects the larger conceptual framework of a moral tradition, a moral ordering that incorporates values and responsibilities’. The media accounts therefore offer an opportunity to study this framework. Indeed, since the scandal demanded an explanation, it entailed an explication of beliefs and assumptions that might otherwise have been taken for granted, tacit, or submerged (see Ailon, 2011, 2012; Williams, 2008). Media accounts of the scandal are thus primarily a source of data on the ideational foundations and logic of the ethical discourse framing the event.
Data and analysis
This research is based on an interpretive analysis of articles about Enron. The articles chosen for analysis included discussions about or descriptions of Skilling or Lay and were published in BusinessWeek and Forbes from 1 January 2000 until 31 December 2002. Skilling was Enron’s CEO from February 2001 until his unexpected resignation in August of that year. Lay was CEO for 15 years until Skilling’s appointment, became chairman while Skilling was CEO, and then returned as CEO until Enron declared bankruptcy in December 2001. The date range is designed to capture the initial shock and moral flip that occurred in the context of the scandal: The year 2000 marked the height of Enron’s media glorification (Ailon, 2011: 148); an ‘Enron Debacle‘ was announced by the media towards the end of 2001 (e.g. Forest and Zellner with Timmons, BusinessWeek, 12 November 2001), and the year 2002 was marked by an extensive preoccupation with the scandal that included ongoing ‘revelations’ about Enron as well as other corporate scandals that erupted throughout that year.
Data selection consisted of a preliminary computerized search (through the database of ProQuest Central) for articles that contained the word ‘Enron’ in the relevant date range. Then a further search was conducted within the selected articles for those containing the names ‘Skilling’ and/or ‘Lay’. Those articles which contained discussions about or descriptions of the two managers were selected for analysis: a total of 60 BusinessWeek and 27 Forbes articles.
The two media outlets chosen for this analysis represent a significant portion of the business mainstream. During the period of study BusinessWeek 4 was a weekly trade publication of McGraw-Hill. It is ‘arguably the most powerful business magazine in the world …’ (Salak, 2003: 67) and ‘the leading periodical among general business publications’ (Sterling, 2009: 231). Forbes Magazine, owned by Forbes, Inc., is a bi-weekly magazine advertised as ‘The Capitalist Tool’. It has been characterized by an entrepreneurial focus (Wexler, 2005: 12) and ‘irreverent’ tone (Sterling, 2009: 232). The two magazines are products of corporations that occupy central positions in the increasingly market-oriented media industry (see Corteau and Hoynes, 2006). The content published in both outlets represents popular, mainstream versions of the business-oriented discourse.
In an attempt to conduct a systematic interpretive analysis of the moral and ethical aspect of this discourse, I undertook a classificatory analysis. The analysis was premised upon an inductive logic and based upon a process of emergent coding. Originating from the classic approach of grounded theory (Glaser and Strauss, 1967), its methodological strategy was nevertheless adapted to the research question at hand, in accordance with the more contemporary approach of ‘emergent methods’ (see Hesse-Biber and Leavy, 2008). Primarily, coding was designed as a means of methodically generating interpretive frames about the underlying moral and ethical themes and frameworks of the studied discourse.
The analysis consisted of three major stages. The first stage involved reading and preliminary coding: I reviewed all the articles, listing the different topics that they referred to. At this stage I marked all references to Skilling and Lay.
In the second stage I undertook another, more specific analysis of the ways Skilling and Lay were described and discussed. I coded the substantive characteristics of references to them (for example, ‘description of personal character’, ‘attribution of blame’, ‘explanations of success’, etc.). In addition, I coded the rhetorical strategies that were used (distinctions that were introduced, use of metaphors, cynicism, etc.) and the underlying logic of explanation (retrospective argumentation, causal arguments, strategies of assembling evidence, etc.).
Based on this analysis, I then formulated interpretive frames about the moral discourse characteristic of references to these two figures. I then re-scanned the articles, searching for examples, counterexamples, nuance and exceptions. This process of re-scanning enabled me to repeatedly recheck and develop my interpretive frames, in order to ensure accuracy and precision in capturing the intricacy of the data. Re-scanning continued during the writing phase and constituted an integral part of the process of preparing the presentation of findings.
In light of post-structuralist sensitivities, it is important to stress that, as is always the case, research and writing constitute an interpretive reading of data in relation to which additional possibilities of meaning lie in wait. To help evaluate my interpretation, the exposition of the findings will be accompanied by illustrations: every interpretive statement will be directly illustrated with references and citations, and, as an aggregate, the references and citations will offer a wide illustrative net which speaks not only to distinct interpretive statements, but also to the interpretive framework as a whole.
Findings
In both of the studied media outlets references to Skilling and Lay were characterized by a distinct moral flip. In the year 2000 references were strikingly positive, and they remained so throughout most of 2001, despite Enron’s involvement in California’s electricity crisis. Towards the end of 2001 (but before the actual bankruptcy) BusinessWeek declared an ‘Enron Debacle’ in an article bearing that name (Forest and Zellner with Timmons, 12 November 2001). From that time on, the tone flipped to the negative.
Pre-fall articles: glorification
In 2000, references to Enron tended to focus on Skilling and to idealize him as a businessman and manager. This glorification had two interrelated attributes that I will illustrate here: first, there was an explicit denial that ‘goodness’ stood at the basis of what was being glorified, and a concomitant focus on Skilling’s market (not moral) orientation and character. Second, an outcome-based narrational logic retrospectively linked Enron’s success to this market orientation and character.
With regard to the first attribute—the explicit denial of ‘goodness’—consider the following excerpt from a Forbes article discussing a social initiative of two Enron employees: Enron Corp. has a lot of smart folks with little to do on weekends. A sad comment, perhaps, on Houston’s social scene, but a circumstance that led to the first corporate venture capital fund devoted to women and minorities to be started by a nonfinancial institution. Enron Investment Partners owes it existence to Domingo Drakes, 28, and Claude Tellis, 27. In their day jobs they studied ways to privatize Latin America’s energy industry. When Saturdays and Sundays rolled around, they teamed up with other consulting types … to offer entrepreneurial know-how to small businesses in Houston’s impoverished Fifth Ward. That’s where business and volunteering intersected. Pockets of Latin America and rundown urban areas in the US are similar, Drakes and Tellis realized. … Each world holds enormous potential for investors who strike early. This isn’t about charity; this is capitalism at its most self-enlightened … They needed a boost from the top. So the pair spent months talking to folks like Kevin Hannon, head of Enron Capital and Trade; President Jeffrey Skilling; Chief Executive Kenneth Lay; as well as board members. Naturally, there was skepticism. ‘Why Enron?‘ was usually the first question; ‘How profitable?‘ was almost always the second. Drakes and Tellis countered with the argument that if Enron was willing to gamble in Russia, India and Brazil, why not in Houston, Los Angeles and New York? … They prevailed. ‘Skilling told us, “We’re not doing this because it feels good”, Drakes recalls. “We’re doing this because it makes business sense”’. Which represented a vindication of their efforts; neither guy was looking for special favors. (Cook, Forbes, 16 October 2000)
In this citation the writer explicitly rejects an interpretation of the reported events which might assume plainly ‘good’ motivations: the two Enron employees who initiated the reported project did so because ‘they had little to do on weekends’; the project itself ‘isn’t about charity’ but about ‘capitalism’; Enron’s top executives were primarily concerned about the project’s contribution to Enron’s profits; and Skilling is cited as clarifying the fact that ‘good’ is not the motivation for his decision.
This explicit attempt to deny ‘good’ as a motivation reflects two somewhat paradoxical moral discursive impulses: on one hand, the article identifies ‘good’ with helping women and minorities, but on the other hand, it denies that helping women and minorities is a good motivation, insisting that this (like any) good cannot be a cause of action, but only an outcome; indeed, an indirect outcome of a commitment to business success. This commitment, moreover, is defined as management through risk; as a managerial willingness ‘to gamble’.
To the same extent that Skilling’s alleged denial of ‘good’ as a motivation was enthusiastically embraced and objectified, statements in which he did refer to ‘good’ as a motivation were not. On February 12, 2001, BusinessWeek ran a cover-story about Enron’s involvement in the California electricity crisis. In an article subtitled ‘Enron, the Largest Energy Merchant, Won’t Let California Stand in Its Way’, the writers state: On this cold January day in Houston, Enron (ENE) President Jeffrey K. Skilling could easily play the pirate that California consumer groups are casting him as these days. After two weeks of sailing with his three children in the Virgin Islands, Skilling’s face is slightly sunburned, and he sports a rakish post-vacation beard. But the CEO-elect isn’t buying the buccaneer image that some have slapped on his company. He clearly thinks Californians should be thanking Enron, not castigating it, for its role in trying to push open the state’s power markets. ‘We’re on the side of angels’, he says. ‘We’re taking on the entrenched monopolies. In every business we’ve been in, we’re the good guys’. Alas, the nation’s largest energy merchant is garnering no such accolades from California’s great deregulation experiment. Soaring power prices have pushed the state’s utilities to the brink of bankruptcy and forced Third World-style blackouts across the world’s sixth-largest economy. … Skilling argues that Enron’s exposure to fallout from California is minimal. … That explains why most observers believe that Enron will emerge with its earnings engine intact. … The seeds of California’s energy debacle were planted long before deregulation set in, though. … The badly flawed 1996 deregulation scheme—some terms of which Enron and others fought from the start—only exacerbated the problems. (Zellner with Palmeri et al., 12 February 2001)
Thus, although the writers open the article by cynically countering accusations of Californians against Skilling, they do not embrace or objectify Skilling’s statements about being ‘on the side of angels’ or with the ‘good guys’. Rather, the focus of the article is on the issue of Enron’s success, and its major preoccupation is with the question of the extent to which California would ‘stand in the way’ of this success.
Indeed, like the Forbes article cited earlier, BusinessWeek’s characterization of Skilling did not focus on any ‘good’ that he might have wanted or intended, but on the success that he allegedly brought about by means of a managerial style that seeks risk but maintains control. The retrospective linking of Enron’s success with Skilling’s (or Lay’s, see, e.g. BusinessWeek 10 January 2000)
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market-oriented deeds and character is the second attribute of glorification. Consider the following excerpt from another article that appeared in the same special issue, titled ‘Derring-Do in the Corner Office’: Ask Jeffrey K. Skilling’s friends about the soon-to-be chief of Enron Corp. (ENE), and you’re likely to hear some tale about his adventure-seeking. … For a man who spends his life managing risk at the nation’s largest energy merchant, Skilling’s out-of-the-office pursuits might seem perplexing. But Enron executives insist that CEO-elect Skilling, 47, combines an odd mixture of tight risk-management controls with a freewheeling entrepreneurial style that has helped boost Enron from $4 billion to more than $100 billion in revenues since he joined in 1990. ‘He’s the most innovative guy I’ve ever been around’, says Richard A. Causey, chief accounting officer. (Zellner, BusinessWeek, 12 February 2001)
This citation, then, first characterizes Skilling by what is acknowledged as an ‘odd mixture’ of traits, namely the combination of ‘tight risk-management controls’ with an adventurous, ‘freewheeling’ style, and then retrospectively links this ‘odd mixture’ to Enron’s revenues. Note how the same narrative which links Enron’s success with the management and adventurousness of the CEO is reaffirmed by a list of supposedly ‘dry’ facts that appeared in a sidebar in Forbes: Jeffrey K. Skilling, 46, president, Enron, Houston, Tex. Founded: 1985 Revenue (fiscal 1999): $40.1 billion Net Income (fiscal 1999): $893 million Stock high/low (52-week): $78.94/$34.88 Market Cap: $58.6 billion Employees: 17,900 Will climb Mount Kilimanjaro this summer with son. Plans a Tanzanian safari next year with customers and executives. (Corcoran, Forbes, 24 July 2000)
Tending towards an apparently more elaborate narrational style, BusinessWeek further sought to persuade readers of Skilling’s ‘adventurous’ nature and ‘freewheeling style’ by assembling evidence that he (and Lay) did not know quite a bit about what went on in the company. Note in the next citation the glorification of this un-knowingness as a mark of managerial talent and business prowess. Furthermore, note again the retrospective link that is both implicitly and explicitly made between this un-knowingness and Enron’s success: Enron Corp. President Jeffrey K. Skilling was nearly the last person in his company to hear about the energy giant’s $15 million effort to begin online trading of natural gas and electricity. In September, when developers were locking in the site’s black-and-orange color scheme … they finally consulted the boss. That was four months after the team of 380 employees started an around-the-clock effort to build EnronOnline, which has since handled billions of dollars in trades. Was Skilling ticked off at being out of the loop on such a big project? Hardly. He welcomed it as evidence that the flexible culture he’d been nurturing for 10 years at Houston-based Enron was perfectly suited to the Internet Age. ‘This was a sign that the organization’s health was good’, crows Skilling … The best part: The work was funded from existing budgets, never requiring the approval of Skilling or CEO Kenneth L. Lay. If anyone still confuses Enron with the sluggish pipeline business from which it sprang, they won’t for long. The company that revolutionized the marketing of natural gas and electricity after deregulation began in the mid-1980s is wielding a powerful new weapon: the Web … Consider this: Enron is the largest wholesale marketer of natural gas and electricity in North America … By creating the financial tools, such as gas futures, that made energy tradeable, Skilling has boosted Enron’s revenues tenfold … Plug in the Web, and the mixture becomes, well, electric. (Zellner, BusinessWeek, 24 July 2000)
Here, too, Skilling’s idealization serves as a retrospective explanation of Enron’s success. As is evident, this narrative is based on a backwards-in-time logic which connects a positive outcome to a glorified ‘odd mixture’ of deeds and traits. When the future is referred to, the writer of this article reaffirms the business and managerial ideals, while nevertheless expressing doubt about their prospective value: Expect Skilling to test Enron’s Web limits even more. … ‘The real risk is you don’t move fast enough to capture the opportunity’, says Skilling. Yet some question whether Enron in moving too fast to get it all right. Enron’s foray into residential power sales, for example, follows the company’s 1998 retreat from the same market in California. And the company’s boldest initiative—bandwidth trading—is far more complex than buying and selling natural gas or electric power, critics say. … [But] That sounds sweetly familiar to Enron execs. When they started trading electricity six years ago, naysayers warned it would never be bought and sold like gas. Now it is. Skilling predicts bandwidth will be, too. … Whoever’s right, the risk is remarkably small. … To ensure that Enron doesn’t run out of steam, Skilling is adjusting the open culture that allowed the online-trading project to develop undetected. The company now rewards risk-taking by employees, as measured by their peers. … Even foes acknowledge that Enron’s flexible culture and track record for innovation should serve it well. (Zellner, BusinessWeek, 24 July 2000)
Note how ‘risk’ is flexibly constructed in this citation: ‘The real risk’ moves around, defined one way and then another, acknowledged as possibly large only to be immediately redefined as ‘remarkably small’. The moral certainty of the retrospective idealization characteristic of the earlier citations is replaced here with a forward-looking hopefulness: a stance that is on the whole positive, but also ambiguous and uncertain. The discourse that identifies ‘good’ but explicitly denies its feasibility as a motivation for action, insisting on seeing it solely as the indirect outcome of moneymaking, avoids making a final judgment when outcomes have not yet materialized; when money has not yet been made.
In sum, Skilling’s glorification countered the logic of ‘goodness’ as a feasible motivation for action in and of itself, granting the primary narrational authority to market outcomes. Its taken-for-granted and continually reaffirmed assumption was that Enron’s exceptional success was a good thing, and its prime effort was to retrospectively link this success to Skilling’s ‘odd mixture’ of adventurous-but-controlling spirit and deeds. To the extent that such glorifying discourse influences self-constituting forms of moral conduct, as Foucauldians might argue, it places the pursuit of market success in prime focus as a means of achieving moral ‘good’; it marginalizes the importance of inner goodness; and it constructs a ‘suspended’ moral outlook on conduct when outcomes are not yet known. The glorification of Skilling is thus a ‘discourse of exemplarity’ (Ten Bos and Rhodes, 2003) whose moral logic is retrospective and market-centered, placing the primary focus of attention outside the ‘self’.
Post-fall articles: demonization
As far as post-fall articles were concerned, there seemed to be a difference in emphasis between Forbes and BusinessWeek articles. Again granting the primary narrational authority to market outcomes, both magazines treated the fall as the unveiling of a truth, and thus the pre-fall Enron as a lie. But Forbes tended to construct the fall as a market punishment and moral lesson to us all, while BusinessWeek—as a market crime.
At the basis of Forbes’ market-lesson narrative lay (once again) the attempt to explicitly contradict an assumption that ‘inner good’ is the reason for ‘good’ outcomes, and to posit the market as an ethical educator of us all, ensuring the good that we cannot rely on otherwise. Consider the following excerpt from a commentary published a year after the bankruptcy: Look past today’s scandals and you’ll find that capitalism has always been founded on trust, honesty and decency. That’s the only way it works. In the 18th- and early 19th-century Britain a sizable chunk of the nation’s economy was run by members of the religious sect known as the Quakers. … Initially their success was built around the benefits Quakers got from trading with one another. … Their common faith facilitated trust ... [I]f you wanted to find a real example of how the system works, you’d be better off picking … Quaker tradesmen than you would Jeffrey Skilling. Over time, in fact, the evolution of capitalism has been in the direction of more trust and transparency, and less self-serving behavior; not coincidentally, this evolution has brought with it greater productivity and economic growth. That evolution, of course, has not taken place because capitalists are naturally good people. Instead it’s taken place because the benefits of trust—that is, of being-trusting and of being trustworthy—are potentially immense and because a successful market system teaches people to recognize those benefits. … The history of capitalism shows the value of trust and fair dealing. But it’s a lesson that capitalists periodically need to learn all over again. (Surowiecki, Forbes, 23 December 2002)
I would like to emphasize several attributes of demonization that are illustrated by this citation. First, it explicitly sanctifies a market-centered rather than a self-centered ethical account, constructing a sense of weariness towards the latter. Thus, the evolutionary narrative presented places its prime emphasis on a notion of market force that turns truthfulness into a benefit and untruthfulness into a loss that people, the eternal profit-seekers, should recognize. The idea that an external force (the market) makes truthfulness possible by instrumentalizing it again marks the complex moral structure that is characteristic of this discourse, which first identifies ‘good’ (honesty in this case) and then insistently denies its feasibility as a motivation in and of itself. Moreover, using universalistic rhetoric, it casts all ‘capitalists’ under this weary light, thus in a sense demonizing them all: all ‘capitalists’ need to be periodically disciplined by the market.
Paradoxically, then, in such articles demonization did not exactly consist of the moral othering of Enron’s managers, but the opposite: a construction of all capitalists as quite likely to fall where they had. For example, in an article written by Forbes publisher Karlgaard (1 April 2002), he recounted his experience of taking the FAA’s pilot’s instrument rating test, and his temptation to cheat on ‘the outdated, poorly worded, obscenely drawn, wickedly confusing and wildly irrelevant test’. In the main section of the article, subtitled ‘My Ken Lay’, he states that ‘[i]t was a close shave, and it scares me to think about it now’. Describing the actual steps he took in order to cheat on the test, including a lie he told his son as an excuse to come home early on the night before it, he eventually testifies that, at the last moment, he decided not to cheat. Nonetheless he says: ‘I don’t know about you. But when I watch the moral meltdowns at Enron and Global Crossing or of famous CEO marriages, I feel outraged, but not too much. I feel something else. I feel the shiver of recognition’.
So, although ultimately he did not cheat on the test, this writer treats lying as something that he and his readers can all easily relate to; can easily identify with from their own personal experiences and ‘close shaves’. The dramatization of the tempting force of the immoral was also apparent in that calls for good behavior were often couched in instrumental rationalizations, reaffirming the notion that they are not feasible by themselves. For example: ‘What you’re going to find is not necessarily that if you are ethical you will succeed, but the probability that you will is significantly greater than if you are not’ (Greenspan, cited in Barrett, Forbes, 4 February 2002). An exception was a Forbes commentary titled ‘Oxymoron 101’, which stated that ‘the evidence is not even clear that honesty pays’ (Seligman, Forbes, 28 October 2002). This commentary sought to redirect attention away from allegedly futile ethics discussions to the goal of maximizing shareholder value, which, according to the writer, is the only socially responsible thing to do: the only way to achieve social good. The commentary ended optimistically with the results of a study showing that MBA candidates are indeed dedicated to the importance of shareholder value. 6
The notion that good has to be instrumentalized one way or another in order to become feasible meant that demonization was based more on a market than on a moral othering. The notion that Skilling fell because he failed to adhere to market discipline implied that his deviancy was primarily a market deviancy. The following excerpt from another Forbes commentary titled ‘The Confidence Game’ even goes so far as to say that, if not for the market, no one would be worthy of trust. Trustworthiness can only exist in the market: Why do I trust Gary Winnick and Jefferey Skilling—nefarious former chief executives of notoriously bankrupt companies—more than I trust Senator John McCain of vaunted valor in prison camps or David Broder of Pulitzer fame or Senator Joseph Lieberman of famously flinty integrity? Why do I trust Kenneth Lay of Enron and Bernard Ebbers of WorldCom more than I trust Justices William Rehnquist and Antonin Scalia, the stalwart intellectual leaders of a nominally conservative Supreme Court, or even George W. Bush, that most trusted of Presidents? … The reason I trust disgraced executives more than politicians, judges and journalists is the same reason that I trust physicists more than I trust sociologists. The answer comes from the eminent philosopher of science Karl Popper: falsifiability. In science, falsifiability means that a hypothesis is presented with sufficient rigor to be proven wrong, that is, falsified. It is the condition of trust. … Under capitalism power flows to precisely the people who are willing to stake their money not on gambles or sure things but on testable hypotheses, thus generating knowledge and wealth for society. Entrepreneurs are trustworthy because they accept a moral code of testability and falsifiability rather than one based on sentiment, sanctimony, good intentions, good press, good luck, good looks or guaranties. … I trust chief executives because they deal in projects that can go bankrupt. They cannot repeatedly or consistently lie about their companies because the truth will out in a relatively short time. Even at Enron, Lay and Skilling could deceive themselves and the public only for a matter of months. … Both Enron stars learned their lessons (about off-the-books subsidiaries and financial engineering, for example), and they taught them to the world. (Gilder, Forbes, 23 December 2002)
This excerpt, then, both defines Enron’s fall as a market lesson and insists that even those who seem most trustworthy are not really worthy of trust. The market, being endowed with the ability that other social institutions lack of closing off immoral paths of action that would otherwise be pursued (in this case off-the-books subsidiaries and financial engineering), taught us all a moral lesson. A ‘moral code of testability’, I would like to point out, is a moral code of outcomes which, despite talk of falsifiability, seems caught in a tautological loop whereby the fall is simultaneously defined as punishment and taken as proof of punishment.
But Skilling and Lay were not the only ones to be punished: the notion of a market lesson might have been justifiable as far as the executives were concerned, but what about the thousands who had lost their investments? Apparently writing to this audience, BusinessWeek articles depicted the fall less as a lesson and more as a crime: a crime against investors. ‘Who’s to blame?’ asked BusinessWeek a few days after the bankruptcy (Coy et al., 10 December 2001), and immediately supplied the answer: ‘[m]any fingers are pointing at Skilling … Also facing the music are Lay and [CFO] Andrew S. Fastow …’.
Here, too, I should stress, the general claim was that the failure resulted from distinct transgressions, but preoccupation with blame implied that the market was not only the judge—the teacher of lessons—but also the victim (Ailon, 2011: 152): it was a matter of proving not only that Skilling and Lay deserved their punishment, but that they were guilty of their punishment. Consider the next citation: In a free-market economy, companies are supposed to fail because of the business cycle or bad business decisions. Failure from loose and sleazy practices, if not outright fraud, is another matter. (BusinessWeek, Nussbaum, 28 January 2002)
In other words, this failure was not merely a failure, but a crime. Thus, long before Enron’s legal verdict was in, its managers were defined as crooks (BusinessWeek, 1 April 2002) who committed ‘sweeping deceptions’ (Editorials, Businessweek, 4 February 2002); who ‘have been exposed as moral equivocators’ (Byrnes with Byrne, Edwards et al., 23 September 2002); who still have ‘plenty of chances to come clean’ (Zellner, BusinessWeek, 10 December 2001); and who were involved in ‘corruption on a massive scale’ (Nussbaum, Businessweek, 28 January 2002). Their sins towards the market—both judge and victim—were treated as obvious and self-evident: Now, I’d like to propose an annual award that will simply be called the Enron. The award—and the accompanying trophy, a gold statuette of Enron ex-Chairman Kenneth L. Lay—will go to the company whose actions did the most to undermine capitalism and free markets in the preceding year. In its inaugural year, the Enron Award, to be nicknamed the ‘Kenny Boy’, will go, of course, to Enron. Clearly, Enron richly deserves the honor. (Mandel and Zellner, BusinessWeek, 20 May 2002)
The effort to persuade readers of ‘loose and sleazy practices, if not outright fraud’ involved a complete reversal of past reality statements: the earlier effort to prove that Enron’s executives embraced the ‘freewheeling’ and the uncertain, that they ‘did not know’ quite a bit about what went on in the corporation or about what their business initiatives would eventually yield, while nonetheless managing to maintain control, was replaced with an attempt to assemble evidence of two primary transgressions: that Skilling and Lay did know but lied, and that they did not control.
The criminalization was much more vociferous as far as Skilling was concerned, but I will discuss Lay first. Articles repeatedly emphasized the famous memo that whistleblower Sherron Whatkins had sent Lay, the claims of which he attempted to investigate (e.g. Zellner, BusinessWeek, 16 December 2002; Thornton et al., BusinessWeek, 12 August 2002). The existence of the memo was posited as proof that Lay possessed knowledge about financial problems (e.g. Nussbaum, BusinessWeek, 28 January 2002) and chose to hide or ignore them. Moreover, an editorial stated that ‘Hardly anyone inside the company was urging caution, certainly not chairman Ken Lay’ (BusinessWeek, 17 December 2001). 7
With regard to Skilling, consider the following excerpt: Now, Washington wants a crack at Jeff Skilling, the mystery man at the center of the Enron scandal. He was the architect of Enron’s strategy and of much of the financial underpinnings. … Investigators in Congress are curious as to just how the brilliant and intimidating Skilling ran his company—and whether he orchestrated the accounting scandal that brought down the nation’s biggest energy trader. … But even if Skilling doesn’t answer the Senate’s questions, he’ll have a hard time escaping the spotlight. By nearly all accounts, Skilling, 48, was Enron’s chief visionary, head cheerleader, and internal compass. He created and embodied the in-your-face Enron culture, where risk-taking, deal-making, and ‘thinking outside the box’ were richly rewarded, while controls appeared loose at best. The question is, did he implicitly or explicitly push subordinates to break laws as a heavily indebted Enron scrambled to hide years of bad investments to keep its crucial credit rating? ‘Enron was presented externally as a flat organization, but there was never any question who was in charge’, says a former Enron trader. ‘It was Jeff’. (Zellner with Palmeri et al., BusinessWeek, 11 February 2002)
Note here that the fall is tied to an accounting scandal and how Skilling’s role in this scandal is first acknowledged as a question and then rhetorically rendered a non-question in four consecutive steps: his description as ‘brilliant and intimidating’; the claim that ‘by nearly all accounts’ he was the chief and head; the statement that ‘controls appeared loose at best’; and the closing citation of an ‘Enron trader’ who declared that ‘there was never any question who was in charge’.
In other words, the acknowledgement of a question is followed by increasingly damning ‘rhetorical blows’ which, above all, seem to constitute Skilling as the main and legitimate target for post-fall anger, despite the questions remaining. Indeed, the article then goes on to repeat the same rhetorical movement once again: Former colleagues are divided over how much Skilling knew about Enron’s looming financial troubles before his surprise exit. … But even those who are reluctant to attribute sinister motives to the former McKinsey and Co. consultant paint an unflattering portrait. Skilling ‘was a brilliant strategist and a terrible manager’ who surrounded himself with ‘yes men’, says a high-level Enron exec. A veteran analyst says the impulsive, immature Skilling … was simply a poor choice for CEO: ‘He didn’t provide the kind of balance wheel so necessary for a CEO. Someone has to say no’. That’s the generous view. Sources close to a Securities and Exchange Commission probe say they’re skeptical that underlings could have concealed wrongdoing from such a hands-on manager as Skilling, who regularly walked the halls and talked to employees. A more damning picture is gaining currency among critics as a growing number of ex-employees describe a rogue company that seemingly created earnings from thin air in unit after unit … ‘Everyone knew that the company was a house of cards and that it was overvalued’, says an ex-manager at Enron’s Azurix Corp. water-services unit. … But if controls in Enron’s trading units were not as strong as Skilling purported, some former and current employees say controls were in fact extremely weak in other parts of the company. Certainly, they say, he did little to control his closest confidantes. (Zellner with Palmeri et al., , BusinessWeek, 11 February 2002)
Thus, acknowledged doubts regarding what Skilling ‘knew’ are confronted first with the assertion that even those who think ‘he had no sinister motives’ agree that he was ‘a terrible manager’ who did not know how to ‘say no’; second, with a less ‘generous view’ that he had to know because he was a ‘hands-on manager’; third, with an even more ‘damning picture’ that ‘everyone knew’ that he was managing a ‘rogue’ company and a ‘house of cards’; and finally with a statement that controls were weaker then purported in some places, and, according to ‘some’, ‘extremely weak’ in others. This admission of doubt followed nonetheless by the assembly of increasingly damning testimonies that Skilling did know and did not control made one thing clear: this was an attack, a prosecution in what was thus enacted as a public trial.
Indeed, this trial was conducted after the market-verdict was in, but before the legal verdict was in, thus explicitly sanctioning the market ‘truth’ over, above, and regardless of whatever legal questions remained, as well as over, above, and regardless of whatever had previously been said about Skilling and, moreover, Lay. ‘Kenneth Lay, Accounting Expert’, was thus the cynical title of an article that reversed past ‘truths’ by recalling that ‘Once upon a time, Enron (ENE) CEO Ken Lay was an advisor on accounting’ in an SEC-commissioned task-force (Weisul et al., BusinessWeek, 18 February 2002). Here is another example of the sanctioning of market ‘truth’ over past reality statements: ‘[A]s everyone knows, with Enron, nothing was quite as it appeared. … [A]n army of academics and consultants descended on Enron in the late 1990s and held it up as a paragon of management virtue. … The Harvard case study put it simply enough: ‘Enron’s transformation: From gas pipelines to New Economy powerhouse’. If only that were true. Many of the same academics are now scurrying to distill the cultural and leadership lessons from the debacle. Their conclusion thus far: Enron didn’t fail just because of improper accounting or alleged corruption at the top. It also failed because of its entrepreneurial culture—the very reason Enron attracted so much attention and acclaim. The unrelenting emphasis on earnings growth and individual initiative, coupled with a shocking absence of the usual corporate checks and balances, tipped the culture from one that rewarded aggressive strategy to one that increasingly relied on unethical corner-cutting. In the end, too much leeway was given to young, inexperienced managers without the necessary controls to minimize failures. … Skilling often described the new culture as ‘loose and tight’ … At Enron, however, the pressure to make the numbers often overwhelmed the pretext of ‘tight‘ control. ‘The environment was ripe for abuse’, says a former manager in Enron’s energy services unit. (Byrne with France and Zellner, BusinessWeek, 25 February 2002)
Here we see an explicit display of all that cannot hold blaming and anger back: all truths of yesterday, all arguments and inconclusiveness. Indeed, since they were written after the market-verdict was in, these articles were not merely a prosecution in this public trial, but also a means of executing the sentence: of complementing the economic punishment with a discursive one.
Forbes articles, too, sanctified the market-verdict as the highest moral ‘truth’, but were somewhat more reserved, insistent that the economic punishment of the market was severe enough, and that no further regulatory or legislative interventions were needed. This was ‘corporate deceit’, but there were clues that investors could have paid more attention to (Rogers, 16 September 2002); ‘someone will probably go to prison for’ Enron’s deeds, and ‘all of it happened on Ken Lay’s watch’, yet ‘[t]he recent avalanche of bad press … had buried the extraordinary contributions’ that Lay had made to furthering energy deregulation—a contribution that ought to survive the scandal (Mack, 14 October 2002); those on top had ‘sinned’ and ‘they must pay’, but they ‘screwed up’ like an ‘addicted gambler’, not like an unethical cheater, and ‘the addict-or-criminal question matters enormously as we set about, through laws and regulation, to prevent another Enron’ (Karlgaard, Forbes, 4 March 2002). Hence it appears that the main focus of Forbes writers such as these was on protecting the market from any post-scandal reforms.
Whether they took the role of the high-priests who decipher the ethical lesson of the failure and encourage quiet submission to it, or the role of the angry prosecutors who depict the failure as a crime and direct anger towards alleged criminals, Forbes and BusinessWeek writers were united in their moralization of the failure. Both media outlets portrayed the fall as a moral truth; indeed a superior moral truth. Thus, post-fall accounts were generally a performance of a discursive commitment to the market (see also Williams, 2008); to the reign of its outcome. They sanctified the status of the outcome as both a moral compass and a verdict. Articles directed anger towards Skilling and Lay, but to some extent they also demonized us all, implying that morality is primarily outside of us. Alongside the insistence that failure in itself is not a crime, pre-fall articles implied that we can only seek and find good through success in the market, whereas post-fall articles implied that we can expose and partially overcome evil through the punishment of failure.
Discussion
As discussed in the opening section, a Foucauldian approach to business ethics sees ethical subjectivity as conditioned and shaped in relation to discursively constituted ‘truths’ and models (e.g. Clegg et al., 2006). In the previous section I offered an interpretive analysis of articles from two mainstream business outlets dealing with a sensational scandal. In this section I will summarize my arguments and discuss the implications of the studied discourse for ethical self-writing. I will ask: what type of ethical subjectivity and logic of action does the studied discourse implicate?
The studied discourse, I have shown, tends to decouple ‘good’ from good intentions and to posit it as an indirect outcome of striving for market success. At the same time, the market is posited as teacher, judge and victim, capable both of capturing evil and wrongdoing and of bringing them to light through failure. Alongside the broad discursive insistence that failure in itself is not a crime, the studied texts thus exhibit an explicit discursive commitment to casting market outcomes—success and failure—as acts of justice; to proving the market right.
Consequently, not only did the texts construct a sense of weariness towards notions of inner ‘goodness’, its feasibility and significance, but the dominant moral logic implied, however unwittingly, that we need external market outcomes to find our ethical way in the world: to do good and avoid evil. We may be able to identify a lie as ‘bad’, but we need market outcomes in order not to lie; we might identify helping the weak with ‘good’, but we can bring this ‘good’ about only by subordinating it to the dictum of seeking profit; and we need the market in order to ascertain the moral value of managerial actions. The true force of morality lies outside us: it is the market.
Accordingly, while the examined texts glorified Skilling and Lay before the fall and demonized them after it, 8 the process of glorification/demonization came into play at a deeper level as well: the ultimate object of glorification was the market, and all ‘capitalists’ were constructed as being in need of its moral education and direction. Indeed, the studied discourse did not merely ‘moralize’ (see Hier, 2008) action, but, paradoxically, at the same time it also de-moralized ‘self’, constructing weariness towards the notion of inner goodness, its feasibility and possibility, and towards the ethical capacity of subjects. At the core of its ethical logic stood a concept of self whose fear could be trusted much more than its morality; a self whose only ethical hope is to fearfully submit itself to the reign of a market which rewards the basest instincts, but nonetheless manages to economically enforce good behavior.
The sense of a contradiction in terms which haunts the notion of business ethics (see, e.g. Stormer, 2003) thus seems to emanate not so much from the concept of ‘enlightened self-interest’ as from the discursive transfer of the moral compass from the ‘self’ to ‘market’. The prevailing discourse of market discipline involves both the constitution of self as largely incapable of a solid or trustworthy moral subjectivity, and the constitution of the market as simultaneously rewarding and punishing this incapability.
In Foucauldian terms, this implies that ethics is discursively challenged by the terms of its own constitution. Even as the dictum of ethical self-formation is, to some extent, promulgated, so is the underlying assumption about the self’s ethical impotence and highly questionable moral capacity. Hence, this is a discourse that deactivates what Foucauldian business ethics theorists treat as the locus of active ethical engagement: the self. Whatever ‘technologies of the self’ emerge in the context of this discourse of market discipline, whatever practices of ethical self-fashioning, these technologies and practices are overshadowed by a fundamental and repeatedly reaffirmed disbelief in the self’s moral agency and capacity. Even as they speak of ethics, the studied texts thus marginalize and subdue ethics’ prime target of meaning (the self), constructing a profound disbelief in exactly what they are striving for.
In this discursive context, it is not surprising that ‘the landmark scandals of the early 21st century had no impact on the business media’s inclusion of ethical issues in their portrayals of successful corporate leaders’, as Hannah and Zatzick (2007: 372) discovered in their quantitative content analysis of leadership portrayals in the business press. The transfer of the moral compass from ‘self’ to ‘market’ indicates the sanctification of profitability not only above all else, as they argue, but also as closer to morality than anything that might be said about the leaders’ selves. This makes sense in a context where ethics is much more tightly coupled with the market than with subjectivity.
Moreover, the transfer of the moral compass from ‘self’ to ‘market’ entails the adoption of a (paradoxical) backwards-in-time moral code (see also Ailon, 2012). Its predominantly retrospective logic, its outcome-based ‘moral code of testability‘ (Gilder, Forbes, 23 December 2002), implies that the present moment of acting, the ‘now’ of doing, of deciding, to a great extent unfolds within morally uncertain grounds, awaiting the moral test of the outcome. Indeed, the sanctification of the moral test of the outcome over and above any past truths, present ambiguities, or remaining legal questions was textually performed in the studied texts. In various passages doubt was assembled and then confronted with ‘rhetorical blows’ of mounting intensity, and past reality statements were explicitly surrendered and abandoned. What had been decoupled from good intentions before the fall and celebrated as the embracement of the ‘not-known’ was, after the fall, attributed to bad intentions and posited as ‘known.‘ This way, the ‘code of testability’ was indeed rendered moral in the texts; it was discursively moralized.
In the studied discursive realm, then, ethics was haunted by a disbelief in the ethical agency and capacity of human subjectivity, and a market commitment 9 was actively performed through explicit and repeated sanctifications of the failure as a moral truth (long before the legal verdict was in). The explicit commitment to proving market outcomes ‘moral’ came at the paradoxical price of the erosion of belief in the possibility of moral subjectivity in the market. This commitment—which, as argued, was explicitly performed in the texts—seems to imply that those who act in the business world act within a dominant collective sensemaking framework whose primary moral impulse is to grant moral authority to the yet-unknown-outcomes of their actions. In this context, morality is rendered less feasible through what Foucault terms ‘practices of the self’ and more feasible through success-driven ‘practices of the market’.
And what are these ‘practices of the market’? Before the fall writers sought to explain Enron’s success by linking it to an ‘odd mixture’ of traits and deeds: a willingness to take risks, to not-know, to embrace the freewheeling and the uncertain, to combine ‘tight’ risk-controls with ‘loose’ management, to be primarily committed to ensuring profit. The obscurity of this ‘odd mixture‘—the potential malleability of the actual content of these terms—and also the sense of uncertainty characteristic of future-oriented references to them, made it possible to rationalize success by linking it to reasons without fully committing to what these reasons are or will be in the future. The ‘discourse of exemplarity’ (Ten Bos and Rhodes, 2003) inherent in Skilling’s and Lay’s initial glorification offered an ambiguous norm of action whereby exemplarity was subordinated to the rule of the outcome.
In other words, the moralization of success was based on two elements: a constructed linkage between success and moral good, and the attribution of specific reasons—risk-taking, adventurousness, freewheeling culture, etc.—to success. The obscurity of these reasons and their moral contingency upon outcomes imply that this discourse—which places the primary moral weight upon success-driven practices of the market—is nonetheless willing to maroon these market practices in a type of moral void; awaiting the verdict of the so-called ‘moral code of testability’.
This same discursive ambiguity applies to ‘honesty’, the main issue under ethical consideration in the post-fall texts. The meaning of ‘honesty’ rests on the assumption of a ‘truth’ that must be told; a ‘truth’ that is humanly discernable and morally binding. Yet this discourse evinces a fundamental disbelief in our moral agencies; tends to see ‘honesty’ as something we can learn only instrumentally through the disciplinary force of market outcomes; and contains truth-choosing performances whereby various truths are assembled and then subordinated to the truth of the outcome. In this discursive universe, the meaning of ‘success’ seems much more certain and clear-cut than that of ‘truth’; its compatibility with conceptualizations of our alleged nature and motivational structure much more definite than that of ‘honesty’. If Foucault is right and discourse conditions the constitution of subjectivity, then this discourse apparently breeds exactly the same ethical faults it so vociferously objects to: an ambivalent orientation towards ‘truth’ and a predominant appetite for success and profit.
In post-fall texts Enron’s managers were blamed for doing wrong; they were later tried and found guilty; the legal lessons of their case concerned things that people should now avoid doing. But to anyone who followed the media coverage of the scandal there were also discursive lessons. As the two mainstream and popular business outlets studied here indicate, media coverage of the Enron scandal may have brought ethics and morality to heightened attention, but it also repeatedly countered the belief that ethics and morality are at all feasible, reaffirming a concept of self that is largely incapable of significant moral subjectivity and sanctifying the authority of market outcomes as a primary moral compass. At least with regard to those portions of the business community that the studied texts are representative of, the findings imply that those acting in the business world act within an ethical framework whose underlying discursive impulse is both to grant considerable moral weight—moral credit, in fact—to the yet-unknown-outcomes of their actions, and to value these outcomes in market terms.
These findings indicate the importance of several questions for future research. A first question is how the discursive transfer of the moral compass from ‘self’ to ‘market’ influences the self-writing and self-formation of individuals within organizations, and the interrelated potential for an ethical ‘critical practice’ (Weiskopf and Willmott, 2013)? Moreover, how does it in turn shape inner-organizational ‘texts’? Additionally, given the ambivalent, market-centered orientation towards ‘truth’, what types of ‘parrhesiastic’ practices (Foucault, 2001)—of truth-having and truth-conveying techniques—take form in relationships individuals have to themselves and to others in such a discursive context?
This study also has other, more practically oriented implications. While a Foucauldian approach sees ethics as operating within powerful discursive formations, it also posits that subjectivity cannot be fully determined or imposed by these formations. There is always a degree of freedom that people can access (Foucault, 1997; see also, e.g. Barratt, 2008; Loacker and Muhr, 2009; McMurray et al., 2011; Weiskopf and Willmott, 2013), although this freedom is also always conditioned; always of ‘a definite, historically produced kind‘ (Laidlow, 2002: 323; see also Crane et at., 2008). As discussed in the opening section, business ethics scholars who promote Foucauldian-inspired ethical prescriptions often speak of the need to facilitate these forms of freedom; to encourage creative processes of reflexive and active self-formation in business organizations (e.g. Barratt, 2008; Crane et al., 2008; Kelemen and Peltonen, 2001).
But in order to make this work, it is important to fully come to terms with what these prescriptions have going against them in this discursive context. If ethics is about reflexive moral self-formation, then here, in the business world, we find a fundamental disbelief in the self’s capacity to morally form. This is a discursive realm that paradoxically expects of ‘self’ all that it also insists is beyond its inner reach; that discursively sacrifices moral belief in ‘self’ for belief in the moral sanctity of the market. To a significant extent, it ethically incapacitates ‘self’, constructing a sense of weariness toward the same moral agencies it also expects people to exhibit. Stated differently, this discourse explicitly marginalizes the space for reflexive and ethical self-formation that Foucauldian business ethics writers commend and target.
Apparently, then, the task of facilitating processes of reflexive and active ethical self-formation must begin through a critical practice (Weiskopf and Willmott, 2013) that tackles this disbelief and incapacitation. According to Wieskopf and Willmott (2013), the ethical self-formation potentially emerges in the critical distance from established truths: the critical questioning and problematizing of moral orders and moral rules-in-use hold the potential for generating a ‘shifting relationship of the self to the prevailing moral order(s)’ (p. 471). The findings of this study indicate that this critical questioning should explicitly target the ethically incapacitating concept of ‘self’: Before the self can emerge as a moral locus and subject of action, there seems to be a need to critically dispel the taken-for-granted assumptions about its deficient and subordinate moral faculties. Facilitating processes of ethical self-formation must begin by exposing and countering the discursive moral tradeoff between self and market; by surfacing how the discursive commitment to morally sanctify the market comes at a price of sacrificing belief in ‘self’ as a viable, feasible, and significant subject of moral reflection and action. I hope this article is a step in that direction.