The textbook used for this class defines corporate governance in chapter two as: the roles of shareholders, directors, and other managers in corporate decision-making. Today, more than ever the public relates this term to the wrongdoings of the company. Most recently this term has been associated with the alleged monopolization against the Microsoft Corporation, as well as the demise of the Enron Corporation.
Since the global attention of the issue arose with Microsoft and Enron many people have developed their own stand on the issue. As the top company executives are receiving excessive pay, the board of directors no longer hold the stockholders best interests at heart, analysts have become corrupt, and botched accounting practices are surfacing the public is becoming skeptical. Shareholders are selling stock and employees are left disgruntled as their superiors are committing breaches of trust by getting rich by tapping into funds for employee benefit programs and salary increases.
The lack of faith in Corporate America has created the biggest crisis in capitalism since the trustbuster era, which was led by Theodore Roosevelt. At that time the concern was over monopolization, now the focus is centered upon "cooking the books.".
Joseph P. Nacchio, who is the head of Qwest Communications, which is also being investigated by the Securities & Exchange Commission (SEC) states that "Corporate McCarthyism" is widespread because the backlash of questionable and fraudulent practices have been blown out of proportion.
As agonizing as it was for the public to watch former employees of Enron give tearful accounts of what happened to them Enron is not solely responsible through the eyes of the SEC. Arthur Anderson, one of the world's largest accounting firms, was also indicted in relation to the Enron collapse. On March 14, 2002 Arthur Anderson was charged federally with obstruction of justice.
