Chapter 7Power and Politics 227The location of power varies
among organizations. At Walt
Disney, enormous power is held
by high-tech scientists in the
research and development group
of Walt Disney Imagineering, a
division formed by Walt Disney in
1952 to create Disneyland. The
company relies on these highly
skilled and creative staffers to
develop cyberland fantasies such
as virtual-reality theme parks,
websites for kids, and smart TV
sets that learn viewers’ program-
ming preferences and automati-
cally record programs they forget
to watch.Enron Requests Action from UBS PaineWebber
Did Enron use its power to cause a UBS PaineWebber employee to be fired? In
August 2001, months before the Enron scandal broke, executives of Enron pressured
UBS PaineWebber (now UBS Financial Services) to discipline one of its brokers.^20 The
broker, Chung Wu, had advised Enron employees to sell their stock options. Within
hours of the complaint, the broker was fired.
When the Enron executive in charge of the stock option program learned that Wu
had warned employees that the company’s “financial situation is deteriorating,” he
notified PaineWebber immediately via email. His message stated: “Please handle
this situation. This is extremely disturbing to me.”
PaineWebber went even further than firing Wu, however. It also sent his clients a
report that Enron was “likely heading higher than lower from here on out.”
PaineWebber has since suggested that Wu acted unethically because his email
messages to Enron clients were unauthorized and because he did not tell them that
PaineWebber’s research analyst rated Enron a “strong buy.”
One might question PaineWebber’s behaviour, however. When Wu sent the email mes-
sages, the stock was worth $36. Only a few months later, it was worthless. PaineWebber
managed Enron’s stock option program and handled large personal accounts for many
of Enron’s executives. It also did investment banking for Enron. Thus, it did not want to
risk losing Enron’s business by suggesting the stock was in trouble.FOCUS ON ETHICSwho control the budget have a great deal of importance. In other organizations, those
who possess the knowledge to keep technology working smoothly are viewed as impor-
tant. What is important is situational. It varies among organizations and undoubtedly
also varies over time within any given organization. Individuals or organizations that are
regarded as important may pressure others to engage in unethical behaviour, however,
as Focus on Ethicssuggests.