Enron, Titanic, and the Perfect Storm (Enron Book Version)
ENRON: CORPORATE FIASCOS AND THEIR IMPLICATIONS, p. 927, Foundation Press 2004
24 Pages Posted: 12 Jan 2007
In this essay (updated from the earlier Fordham Law Review version, I explore the contention of Jeffrey Skilling, former Enron CEO, that Enron's debacle was due to a perfect storm of events. I reject his contention, arguing instead that Enron's downfall was more like Titanic's - hubris and an over-reliance on checks and balances led to Enron's downfall. I then explore how character (especially of those at the top of an organization) can lead to Enron-like disasters, and I talk about how cognitive dissonance can lead to very smart people making very stupid decisions. I end with some musings about how lawyers can learn from Enron.
Keywords: Enron, professional responsibility, lawyers, corporate culture, cognitive dissonance, Titanic
JEL Classification: M14, M52, Q40
Suggested Citation: Suggested Citation