Many of Enrons independent directors were affiliated with Essay

Many of Enrons independent directors were affiliated with organizations that benefited directly from Enrons operations. How would you address this clear conflict of interest - Essay Example The directors’ affiliation with organizations that stood to benefit from the operations undertaken by Enron gave them an opportunity to reap benefits from two sides. To address the underlying conflict of interest, the need to mainstream management is vital. Before directors are installed, there it would be essential to evaluate their relations with other organizations. The establishment of direct links between potential directors and other organizations should disqualify their installation. Investors should also undertake independent evaluations and assessments that relate to their preferred companies. In so doing, they can choose to uphold or ignore the recommendations made by auditors, business analysts, business consultants, or stockbrokers (Dharan & Bufkins, 2004). Directors, auditors, business analysts, business consultants, and stockbrokers work to the best interest of both the shareholders and the organizations that award them service contracts. In the process, the realization of conflict of interest is relatively high. While employees, lenders, and investors could independently and personally influence the extent to which organizational conflict of interest is realized, securities and exchange regulators, in a bid to address the organizational conflict of interest, could oversee the activities undertaken by directors, auditors, business analysts, business consultants, and stockbrokers (Healy & Krishna,