What was the culture at Lehman Brothers like? How did this culture contribute to the company’s downfall?
Culture in a workplace can be determined based upon values, beliefs, interests, and experiences. At the Lehman Brothers they rewarded risk at any cost without validation. One of the main issues was their rapid growth over a 13 year period with very little change to their corporate culture. Questionable deals, unnecessary risks, and short-term profits were rewarded by management. The culture promoted unethical behavior and ignored concerns from conservative associates. The majority of the workers at Lehman Brothers had an understanding that these short term gains may not be in the interest of the company, but their behavior was consistently incented by management and anyone who posed objections was manipulated into following suit. To make matters worse, there was a serious disconnect between executive management and lower level associates and management that contributed to the downfall of their business. These circumstances culminated in an eventual crash, causing the Lehman Brothers to file the largest bankruptcy case in history. The culture of rewarding risk and manipulation of financial reports lead to the Lehman Brothers demise. What role did Lehman’s executives play in the company’s collapse? Were they being responsible and ethical? Discuss.
Part of culture is unspoken and unwritten rules for working together that leads to making ethical decisions. Lehman Brothers executives turned a blind eye because of the high bonuses and rewards given to them that lead to the company’s collapse. In addition, the executives were altering their financial statements to give the appearance that performance was better than it actually was while lining their own pockets. Poor judgment, a lack of professional ethics, and a blatant disregard for honest business dealings lead to their collapse. Although executives may have claimed that they were unaware of these dealings,...
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