Setting the Stage

Abstract

The 2002 meltdown of major U.S. corporations was the culmination of a number of interrelated trends that started in the 1970s and continued unabated through the 1990s. Cultural myths, public policies, and organizational practices coalesced to create a fraud-inducing system, one in which executive selection and reward systems encouraged unethical and/or illegal activities, public discourse elevated private financial gain over the interests of multiple stakeholders and glorified short-term asset appreciation while denigrating long-term corporate development, and public policies and institutional changes seriously weakened executive accountability.