September 23, 2003
Book Review--24 Days: How Two Wall Street Journal Reporters Uncovered the Lies that Destroyed Faith in Corporate America
by William Baue
A new book tells the behind-the-scenes story of Enron's demise and the detective work that revealed
the chicanery in Enron's corporate practices and culture.
The fallout from the collapse of Enron is all too clear, with investors' confidence in corporate
America eroded and regulation changes such as the Sarbanes-Oxley Act's reforms of corporate
governance and accounting oversight. However, the story behind Enron's plummet remains murky to
most, hidden behind a web of complex accounting sleights-of-hand and Byzantine corporate
Rebecca Smith and John Emshwiller's new book, 24 Days: How Two Wall Street Journal Reporters Uncovered the Lies that Destroyed Faith in
Corporate America, reveals the behind-the-scenes story of Enron's fall-from-grace. This
book reads like a cross between several different genres: a mystery/detective novel, a history, a
morality play, and an autopsy report, to name just a few. Readers might be surprised to discover
that it is a page-turner, engrossing in its play-by-play recounting of the toppling of a corporate
"The story is a mystery tale," said Ms. Smith and Mr. Emshwiller, both Wall
Street Journal reporters. "We began with some clues and oddities about a seeming juggernaut of
a giant corporation."
For example, Ms. Smith and Mr. Emshwiller's detective work revealed
the potential conflict-of-interest of Enron chief financial officer Andrew Fastow running LJM1 and
LJM2, investment vehicles that supposedly operated independently of Enron. These revelations,
reported in an August 28, 2001 article, helped initiate the domino effect that eventually toppled
"Like any good mystery, the pursuit of those clues led us down false paths to dead
ends," they continued. "But there were also moments of discovery that produced stories that were
widely viewed as having been influential in the Enron saga."
This influence represents the
best and the worst that the book has to offer. It is fascinating that Mr. Emshwiller's obsession
with a potentially inconsequential partnership, Chewco (named after the hairy but endearing Star
Wars character Chewbacca), turned out to be a hub of Enron's accounting shenanigans.
However, the book also includes extended parenthetical asides (possibly additions of editors
and not the authors) meant to highlight the role of the venerable newspaper in breaking the Enron
story. These addendums, seemingly inserted as self-serving promotions for the Journal,
actually detract from the story. The hype is unnecessary, as intelligent readers can discern for
themselves the paper's importance.
The authors' decision to use the third person instead
of the first person creates another distraction for readers. It is awkward when the authors speak
about themselves from a distance, as if trying to maintain objectivity, especially since the most
interesting aspect of the Enron story is how it intertwines the global and the personal. Ms. Smith
and Mr. Emshwiller document the international business deals as well as the fates of individual
Enron employees, so their decision to obscure their own personal voices in this story represents a
missed opportunity to paint a more complete picture.
However, these are rather minor
problems when considering the scope of the subject matter. This book tells the story not just of
Enron's demise, but also of a transition in corporate culture. Before Enron's fall, few investment
analysts were questioning Enron's opaque disclosure practices. Now, transparency, corporate
governance reform, and codes of conduct are the order of the day.
provides a detailed map of the terrain traversed between pre- and post-Enron. The detective and
mystery elements of the story will keep readers entertained. Other elements of the story (its
detailed history and its dissection of Enron's corpse) may prove even more important to advocates
of disclosure, improved corporate governance, and bolstered business ethics. In order to promote
corporate responsibility, one must understand corporate irresponsibility, which Enron exemplified.