Enron Scandal
CILM Book Review
0834172
IB3A20 Critical Issues in Law and Management
Book Review
Enron, Titanic and The Perfect Storm - Nancy B. Rapoport
Student No: 0834172 Word Count: 1500
1
CILM Book Review
0834172
Two years after Enron filed for bankruptcy in 2001, Nancy b. Rapoport wrote this essay expressing her unique perspective on the real cause of Enron’s demise. This essay catches the reader’s attention instantly, because unlike abundant other articles written on the biggest corporate scandal in American history, the author here rejects Jeff Skilling’s (former president of Enron) argument1 of what brought about Enron’s downfall. She instead uses another metaphor, arguing that Enron’s downfall was more like Titanic’s- hubris and over reliance on checks and balances that led to its demise rather than a ‘Perfect Storm’ of events. The purpose behind her preference of the metaphor ‘Titanic’ over ‘Perfect storm’ clarifies and warns readers about not being misled into believing that Enron’s downfall was based on factors ‘outside of the company’s control’ rather was caused by a ‘synergetic combination of human errors’. In justifying the Titanic as a more apt analogy to the downfall of Enron, the author offers strong arguments such as how the Enron is in some sense a larger-than-life disaster much like the Titanic. While Titanic’s failure was tied to the unrealistic faith in technology to protect passengers, Enron’s failure was tied to the unrealistic faith that formal and informal checks and balances could always keep the market honest. However, her strongest argument of ‘hubris’ found both in the top executives of Enron as well as the officers of Titanic is not convincing. As much as the greed for money is evident in Enron employees and their arrogant behavior, her equivalent assertion that the Titanic can trace the loss of life directly to human arrogance (pg 209) lacks adequate evidence. Whether her proof of
1
*Former Enron CEO Jeffrey+
0834172
IB3A20 Critical Issues in Law and Management
Book Review
Enron, Titanic and The Perfect Storm - Nancy B. Rapoport
Student No: 0834172 Word Count: 1500
1
CILM Book Review
0834172
Two years after Enron filed for bankruptcy in 2001, Nancy b. Rapoport wrote this essay expressing her unique perspective on the real cause of Enron’s demise. This essay catches the reader’s attention instantly, because unlike abundant other articles written on the biggest corporate scandal in American history, the author here rejects Jeff Skilling’s (former president of Enron) argument1 of what brought about Enron’s downfall. She instead uses another metaphor, arguing that Enron’s downfall was more like Titanic’s- hubris and over reliance on checks and balances that led to its demise rather than a ‘Perfect Storm’ of events. The purpose behind her preference of the metaphor ‘Titanic’ over ‘Perfect storm’ clarifies and warns readers about not being misled into believing that Enron’s downfall was based on factors ‘outside of the company’s control’ rather was caused by a ‘synergetic combination of human errors’. In justifying the Titanic as a more apt analogy to the downfall of Enron, the author offers strong arguments such as how the Enron is in some sense a larger-than-life disaster much like the Titanic. While Titanic’s failure was tied to the unrealistic faith in technology to protect passengers, Enron’s failure was tied to the unrealistic faith that formal and informal checks and balances could always keep the market honest. However, her strongest argument of ‘hubris’ found both in the top executives of Enron as well as the officers of Titanic is not convincing. As much as the greed for money is evident in Enron employees and their arrogant behavior, her equivalent assertion that the Titanic can trace the loss of life directly to human arrogance (pg 209) lacks adequate evidence. Whether her proof of
1
*Former Enron CEO Jeffrey+
Bibliography: Enron: The smartest guys in the room. 2005, Magnolia pictures, United States 10