Enron: On the side of Angels

Foremost among them was Andy Fastow whom he appointed as Chief financial officer of Enron Gas Service (EGS . Skilling could have prevented some of Enron 's failure had he took control over some procedural transactions that were left unaccomplished because of complicated procedures

The problem of Enron could have been avoided had Ken Lay and Skilling implemented risk management policy aimed at safeguarding the company from the risk of financial transactions entered into by its employees in behalf of the company . The culture of unsupervised transactions and lax economic activities of

Enron 's people requires its top management to monitor and control such activities in which both Lay and Skilling had failed . As risk monitoring requires awareness of risk at all levels of management , Lay could have done something in to control the damage if had some awareness of the risk those transactions , such as for example the transaction entered into by Rebecca Mark in which she finalized a 3 billion deal to build a power plant in India . Because there was no risk management for this huge project , Enron lost billions of dollars because after the plant opened in 1999 , the plant was shuttered because the contract was annulled because of its extremely high energy bills . Mark also negotiated billion dollar gas-fired power generating in Brazil with no risk management and control . The project was negotiated with no apparent benefit for Enron

Tom Kendrik stressed that risk management involves specific planning for risk . Kendrick puts it

Risk planning begins by reviewing the initial project assumptions Project characters , datasheets , or other documents used to initiate a project often include information concerning risk , as well as goals staffing assumptions , and other information (p . 28

Apparently , most of the projects negotiated by Enron 's people were risky and there was no effort...