Print Сite this

The Documentary “Enron: The Smartest Guys in the Room” Analysis

The documentary tells the story of the biggest fraud in US history. It expresses the narrative of a firm collapse that led to a business scandal. The company was conducting power fraud in California, which led to the executives’ arrest. However, they managed to get away with more than a billion dollars during the crash, leaving employees and investors with nothing. The film contains a series of interviews about the investigation of financial deception. The viewer understands how the company’s leaders committed the Freud triangle fraud and set the wrong cultural tone for the organization; the spectator can analyze how not to make a mistake.

Our experts can deliver a customized essay
tailored to your instructions
for only $13.00 $11.05/page
308 qualified specialists online
Learn more

The Enron corporation had an incentive to commit deceit, which is expressed in investor pressure, the possibility of falsifying the report and rationalizing these actions in their own eyes. The enforcement arises when the company’s management realizes that the reporting data is far from planned and does not meet investors’ expectations. Besides, the pressure comes from personal reasons, such as the lack of an annual bonus on the period’s results. However, this reason is not enough; one still needs to have the opportunity and justification. The possibility of forging documents is presented to an enterprise when agreeing with an extensive bookkeeper’s company, which is looking for loopholes through subsidiaries in offshore zones and falsifies documents. A sample of rationalization is the statement “investors will be more pleased to see the excellent performance.” Enron is a prime example of corporate deception across the Freudian triangle.

The wrong tone at the top plays a vital role since leadership, by its moral and ethical principles, sets the attitude towards the work of all employees. The Code of Ethics presupposes honesty and decency; Enron did not adhere to the policy because financial advisor Andrew Fastow created a counterfeit scheme. The company management rewarded employees for unethical actions. Leadership clung to a narcissistic culture when a person in an influential position accepts only their opinion and knows how to get the company out of debt and increase profits. However, such a policy led to a downfall, with assets reaching $ 64.4 billion (Albeksh, 2016). The viewer can recognize that the collapse occurred because of the supreme authority, which is practically not controlled and seeks to make easy money in roundabout ways, violating the code of ethics.

The breakdown is a consequence of management actions and the work of a bookkeepers’ company. If Enron adhered to the moral code and instilled in every employee the principles of honesty, decency, and ethics, this would not happen. A strong organizational culture is a key to the success and longevity of an enterprise. Also, Arthur Andersen LLP could not indulge the customers’ whims and provide truthful financial statements. The accounting firm had its motives to cover up the crime since it was both an auditor and a consultant for Enron. In an ideal scenario, different organizations should hold these positions. The company collapsed because of poor business decisions and tried to recover and increase profits through fraudulent means, from the preached culture among employees to the machinations of an outsourced accounting firm.

Enron’s financial fraud is a product of pressure, opportunity, and rationalization that the executives could have avoided. Pressure from investors and personal gains pushed the business to commit transgression and come up with excuses. The company’s leaders created an unethical culture and encouraged employees to do wrong things. The scandal could be avoided by establishing an organizational structure and a code of honor and the separate work of bookkeeping companies for audit and consulting. Interviews with former managers, business analysts, and reporters show many mistakes that lead to a severe crash and are an excellent educational case for followers.


Albeksh, H. M. A. (2016). The crisis of the ethics of audit profession: Collapse of Enron company and the lessons learned. OALib, 03(11), 1–18. Web.

Cite this paper

Select style


StudyCorgi. (2022, October 8). The Documentary “Enron: The Smartest Guys in the Room” Analysis. Retrieved from


StudyCorgi. (2022, October 8). The Documentary “Enron: The Smartest Guys in the Room” Analysis.

Work Cited

"The Documentary “Enron: The Smartest Guys in the Room” Analysis." StudyCorgi, 8 Oct. 2022,

* Hyperlink the URL after pasting it to your document

1. StudyCorgi. "The Documentary “Enron: The Smartest Guys in the Room” Analysis." October 8, 2022.


StudyCorgi. "The Documentary “Enron: The Smartest Guys in the Room” Analysis." October 8, 2022.


StudyCorgi. 2022. "The Documentary “Enron: The Smartest Guys in the Room” Analysis." October 8, 2022.


StudyCorgi. (2022) 'The Documentary “Enron: The Smartest Guys in the Room” Analysis'. 8 October.

This paper was written and submitted to our database by a student to assist your with your own studies. You are free to use it to write your own assignment, however you must reference it properly.

If you are the original creator of this paper and no longer wish to have it published on StudyCorgi, request the removal.