No One Raindrop thinks it Caused the Flood

After reading about Enron, I wondered a lot about the social phenomenon known as Diffusion of Responsibility. This phenomenon takes places when any one individual feels he does not bare the burden of responsibility because there are many others present that can instead. When an event occurs that requires a response, the individual assumes that someone else will or already has taken care of it, and therefore he does not need to do anything. Had the individual been alone, he would never have allowed the event to occur.

 The most well known example of Diffusion of Responsibility is in the case with Kitty Genovese. A man stabbed and murdered Kitty a block from her New York City apartment while 38 witnesses watched from their windows and did nothing about it. The witnesses heard Kitty yell “Oh my god. He stabbed me. Help me!” but assumed that someone else was already phoning the police for her. The witnesses then either closed the shades or continued to watch until she was dead. However, nobody ever called the police or tried to help her.

It seems like corporations would be prime places to look for Diffusion of Responsibility. In the case of Enron, we can see how many traders used Fastow’s crafted financial solutions while knowing he created them to deceive stockholders. While any one trader may have known the schemes were immoral to use, no one assumed responsibility to stop the others from using them. Fastow also felt his responsibility was diffused based on the fact that, while he created the solutions, others were using them very often. Bankers outside the company who knew of the deceiving financial statements also felt it was not their sole responsibility to speak up. Outside of Enron,

There were lots of whispers in the banking world that Enron consumed incredible amounts of capital, that the company was way overleveraged. But despite the whispers-few bankers were willing to stop doing business with the company” (McLean and Elkind 165).

To stop the diffusion of responsibility that occurred at Enron, the government created federal laws like the Sarbanes Oxley Act. This act requireD top management to sign off that they were responsible for the accuracy in the financial reporting. There could no longer be Diffusion of Responsibility.

It seems to me like the education system should also develop rules or incentives for students that aim to decrease Diffusion of Responsibility in the earlier years. Helping students to learn the importance of assuming responsibility may serve to bring generations of people that are more assertive into the business world. Do you believe schools should do this? For instance, when you pass a computer broken in the library, do you believe there should be a created incentive to report the computer is broken? Do you believe this will decrease Diffusion of Responsibility when students go out into the real world?

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6 Responses

  1. Kelli… this is a very interesting concept!

    Yes, I do believe that if schools began teaching students to decrease Diffusion of Responsibility that it would be helpful. If there were some sort of system to reward those who report broken computer equipment at Bucknell (eg. the left printer in the Taylor lab has been broken for over a month now… I don’t think it has been reported) then student life would also improve (I wouldn’t have to reprint to the right printer).

    Thinking along the lines of this computer example, what if it has been reported and no one has responded? We can destroy the decrease in DoR if those whom are responsible for responding to a complaint or comment do not do so, or at least do so in a timely way. I’m sure some problems were reported at Enron, but since all of the higher ups were in the mess together, no one responded to these complaints. If someone had responded, maybe there would not have been as huge of a crash and they could have saved their business.

  2. The idea of responsibility to me, runs very closely with ethics and the actions we know we should take. I find it interesting in that, as people, there are many instances where we may chose to ignore or refuse action. And because of this, laws must be put in place. You mentioned Sarbanes Oxley, the Good Samaritan laws is another example (I think more fitting to your example Kitty Genovese). But to what point are laws controlling and impinging on us as people? On the road we are headed, it seems that we will one day have a law that dictates how we must act in every different kind of situation imaginable.

  3. Just a quick note – Fastow did not design the trading strategies at Enron.

    Cheers,

    Cara

  4. I don’t believe incentives could be a solution to the Diffusion of Responsibility. I think there would be too much abuse to the system. If every time there was a car crash one hundred people on the highway called 911 looking for a reward it would be too costly to compensate them all. It would change people’s motives and it might become vindictive. It may be difficult to rely on the morality of humans to do the right thing in every situation but I can’t think of a better solution. I know Oprah had an episode on “What would you do?,” in which she set up scenarios and saw how the public responded. There is also a series on ABC where they do this kind of thing. I like the shows because it makes people aware and gets them thinking. It is easy to say what you would do but it is a lot harder to do the right thing when actually facing these circumstances.

  5. I do believe the law is impinging on us, and therefore I argue that we do not set up a law requiring us to do the right thing, but rather an incentive to encourage us to do the right thing. In elementry school we get a sticker for doing our homework, should we also get a sticker for reporting that there is a spill on the floor. Just like stickers might actually help us initally to work hard, might they also help us to learn to take responsibility?

  6. I am not sure if it is really responsibility or accountability. I think people choose to not do things if they know they are not accountable. In Enron’s case, the company was accountable to the shareholders, but the individuals making the decisions were not (which is a part of the reason that Sarbs Ox has that clause). Organizations need to find ways to make people accountable otherwise they will find a this diffusion.

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