ABSTRACT
Since the time of Aristotle, people have been debating why good people engage in questionable behavior and even repeat their mistakes. For example, Arthur Andersen was commonly cited as the best, as well as the largest, audit company in America (e.g., Collins and Porras 1994). Andersen was always profitable; it was a company that was constantly evolving to meet changing global demands; and books have been written about the ethical demeanor of its founder as setting the gold standard for behavior in the audit community. Even so, just before the Enron scandal that brought the company down, Andersen was involved in questionable auditing practices at Waste Management, at Sunbeam, and even at the Baptist Foundation of Arizona. Why did such incidents recur in a company allegedly as fine and well-managed as Arthur Andersen?
