Association of Local Government Auditors

Enron's top management was comprised of intelligent, well-educated people:  Ken Lay, Chairman and CEO , boasted a PhD in economics; Jeffrey Skilling, President, Chief Operating Officer and successor CEO to Lay, was graduated as a Baker scholar from the Harvard Business School; Andy Fastow, Chief Financial Officer, was graduated summa cum laude from Tufts in economics and Chinese and then earned an MBA from Northwestern's Kellogg Graduate School of Business.

Enron's apparent machinations enmeshed banks, credit agencies, and a once-venerable accounting firm, Arthur Andersen & Co.  The Arthur Andersen I knew regarded itself as "the Marine Corps of the accounting profession".  I'm still saddened by its demise because I was impressed by the disciplined indoctrination that I received as a fledgling auditor years ago.  Between 1988 and 1991, Andersen earned $54 million in fees from Enron.  In 2000, Enron paid Andersen $52 million for auditing and consulting services. 

Andersen had lost its founder's motto, "Think straight, talk straight."  Long after I left AA & Co, it became embroiled in accounting scandals such as Sunbeam and Waste Management.  Andersen's conviction on obstruction of justice charges related to the Enron fraud ended the eighty-eight year old accounting firm.

Years ago, I took a class with Dr. Irving Janis who wrote extensively on "groupthink", the tendency of individuals in groups to seek concurrence of opinion while discrediting any opposing factions at the expense of conducting an unbiased, objective analysis of the facts.  Those who might've stood up at Enron or Arthur Andersen to play the role of devil's advocate and challenge ruinous management leadership were effectively muzzled.  Enron's manipulated earnings façade was maintained for several years before it eventually unraveled.  Mom's lesson proved to be true once more:  "Las mientras duran hasta la verdad llega"-the lies endure until the truth arrives.

For Dr. Janis' Leadership & Group Dynamics class, I wrote a term paper on the legendary coach of the 1960s Green Bay Packers, Vince Lombardi.  When I think of genuine ethical heroes, the ones who eschewed form and embraced substance, he's very high on my list next to my parents.  I think of the motivational maxims attributed to him by his players: "The harder you work, the harder it is to surrender," and "The will to excel and the will to win, they endure.  They are more important than any event that occasions them."

The men who played for him responded to his no-nonsense, direct leadership by winning five championships in nine seasons and did not suffer a losing season during his reign.  He earned the trust of his players and created a legacy that remains unblemished.  His virtues are not passé.  Lombardi encouraged his players to find the truth in their purpose because "a 'true truth' is one that works in all aspects of your life."