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December 10, 2003

Helpful Business Tips For Corporate Crooks

I recently finished reading The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron. I heartily recommend the book. Much better than Power Failure, the book written by noted Enron whistle-blower Sherron Watkins. Watkins's book tends to have a very dark, conspiratorial tone when describing the events that led to Enron's downfall. Smartest Guys, on the other hand, combines a very thorough treatment of the inner workings of Enron's shady dealings with some hilarious anecdotes about the major players.

To celebrate this great literary find, I give you:

Dan's Helpful Tips For Being The CEO Of A Public Company That's Engaged In Massive Accounting Fraud

  • Pay as little attention as possible to the things going on around you. Once you've reached the executive suite, out of public view, arrange to be outfitted with welding goggles and a seeing-eye dog.

  • To the greatest extent possible, avoid coming into the office at all. Whenever you're in the office, your subordinates will seize upon the opportunity and try to trick you into attending "meetings" where "issues" that may later prove to be "litigable" are discussed. Offer yourself as a guest speaker at every conference, seminar, trade show, political rally and bar mitzvah you can find.

  • Place your secretary under standing orders to delete all business-related email before you have a chance to read it. If asked about this at a later time, offer the recollection that, as far as you knew, this was the company's records retention policy, which you also did not approve.

  • Numbers can easily be used to prove complicity on your part. Delegate all tasks that involve numbers to your CFO or to the Board Audit Committee, depending on the day of the week. Insist that data only be presented to you on two-color charts with a logarythmic scale.

  • Instruct your Chinese man-servant to attack you when you least expect it, just to keep you on your toes.

  • Make a habit of calling your broker every morning and instructing him to dump all of your stock in the company. If your broker informs you that you have no stock to dump or that your stock is locked up or otherwise restricted, thank him for his time and go on about your day. The pattern you establish will prove favorable to your defense.

  • To maximize the protection that your state's homestead exemption may provide against shareholder lawsuits, build a solid gold house.

  • One of a CEO's most important jobs is to keep employee morale high. Bringing all hands together for a good, old fashioned pep talk is a great way to boost morale during an accounting scandal. As a rule of thumb, try to hold at least one pep talk for every 20% of its value your company's stock loses.

  • Never forget: First you get the money, then you get the power, then you get the women. Getting the order wrong will make it far easier for Elliot Spitzer and his cronies to send you back to that stinkin' cage.

  • People who sit at desks that are cluttered and covered with stacks of documents generally do a lot of important work and know a lot about what's going on in a company. As CEO, there should be nothing on your desk except a picture of your (current) wife and children and a phone. Just to be safe, have your I.T. people unplug the phone.

    • Posted by Dan at December 10, 2003 11:22 AM

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