Lucy Kellaway is correct.

In today's Financial Times piece:

If one employee offends against a bank’s vision and values, it is [his or her] fault. If 5,300 do, it is the bank’s. Wells Fargo has proved that its culture is a hopeless safeguard to anything. The people who have really transgressed are not the rank and file, but the top managers who set up the wrong incentives and who looked the other way as customers were stitched up.

It really IS about the incentives.

Another news clip about my talk(s) in Bogota.

Here, and here's the original post.  I'm still just amazed that I was asked to speak, and I'm so grateful to Superintendent Reyes!

This article tickled the heck out of me.

Especially the observations about academia--see here.

More shameless self-promotion: my article on fees in chapter 11 cases is out.

You can download it here.

The news article that a lawyer does not want to see when she's having her morning coffee.

See here.  Shades of Arthur Andersen's shredding scandal.  Having a rogue manager (assuming that's what happened) shred documents, counter to attorney instructions, is one of a lawyer's worst nightmares.

Who can't love an op-ed piece about corporate greed that refers to Nozick?

See the Financial Times piece by John Kay here.

Why I could be a good director of a public company.

Today's WSJ offers some thoughts on why there aren't more female directors (here).  As I say over at one of my other blogs (here), there are some frustrating implications of that issue.  But here's why I might be useful to some companies:

1. I've actually run two organizations.  They were both educational institutions (I served as the dean of two law schools, the University of Nebraska College of Law and the University of Houston Law Center), not for-profit public companies, but I do have more than an inkling of the challenges facing companies that have to juggle changes in demand and tight workforce restrictions.)
2. I study the behavior of organizations.  OK, I'm usually studying them because they're dysfunctional, but still, I am paying attention to how humans behave in organizations.
3. I study ethics.
4. I understand companies that have to operate in tough financial circumstances.  That doesn't mean that I'm interested only in companies that have filed or are considering filing for bankruptcy protection, but it's fair to say that I could be useful for those types of companies.*

So if you know a company that's looking for more women, and you're comfortable suggesting me as a candidate, I'm interested in talking.

* Of course, if Disney's board ever comes calling, I've loved that company since, well, I was a kid.

WSJ's "Report on the Recent Piggybanking Crisis"

Here.  Classic.

We don't learn. Maybe we can't.

Today's WSJ article about the Olympus scandal (here) proves that we haven't learned anything, really, about avoiding corporate scandals.  Why?  Here are some possibilities:

__ People are inherently evil. 

Nah.  There are good people, and there are evil people.  But most of us fall somewhere in the middle, and it's the situations that we find ourselves in that will push us toward either good behavior or bad behavior.  So I have to reject that gloomy "people are just evil" explanation.

__ Smart people think that they can fix mistakes by covering them up.

Yep.  Ever since Watergate, we've known that the mistakes aren't nearly as bad for us as the cover-ups are, but we keep making the same "let's cover things up" mistake.  Heck, Vegas and other gaming centers are based on the idea that folks will chase their losses until they win again (and they usually don't win again).  But smart people keep thinking that they can outsmart the system, and that they won't get caught.  Will we learn from our mistakes? 

Based on the empirical data, I'm thinking that we won't.  (But that doesn't mean that we shouldn't try.)

Yep, Enron's bankruptcy began 10 years ago.

See Loren Steffy's column here for a good perspective.

Enron in retrospective.

BBC Radio 5 Live's Wake Up To Money asked me a bit about Enron, 10 years later (interview starts around minute 27:30), or click here.

My Dad and my buddy Gus Schill pointed me to the Houston Chronicle's Enron retrospective:  see here, here, and Fuel Fix's compilation, here.  Some of my takes are here, here (Colin Marks and I wrote this one), here, and here.  And the books that Bala Dharan, Jeff (yep, my Jeff) Van Niel, and I did:  here and here.

Short version of my take on things, 10 years later?  Two things:  those who do not learn from history are doomed to repeat it, and humans don't seem to be able to learn from history, at least where their own cognition is concerned.

Why I love Steve Lubben's work, part n.

See his two recent Dealbook columns, linked in this post at Credit Slips.

Giving kudos (and buying ice cream) for 'fessing up to mistakes.

I've been meaning to post a link to this New York Times story about how to encourage learning from mistakes (here) for a while.  The gist is that it's better to bring mistakes out into the open and treat them as a learning opportunity (by having the mistake-maker buy ice cream for everyone) than it is to yell at the mistake-maker in private.  I love that idea.  It lessens the angst from having made a mistake and acknowledges the mistake in a positive way.

Let's keep watching the Gupta insider trading case.

Today's Wall Street Journal describes the nuanced issues in this case (here).

My take?  As long as boards are composed of people who frequently work with each other and who have more similarities than differences, there's no one there equipped to ask "why are we doing this?"  Without someone asking the questions, there's no reason for boards to change behavior.

Enron rap--a new classic.

Hat tip to Jackie Benson (who happens to be exceptionally smart, talented, and fun to know) and Above the Law.  You can listen to it here.  Click on Daniel Sokol's blog (here) for the text of the full rap.

Failure can be a very, very good thing.

See here.

Great post over at Credit Slips.

See here.  Adam Levitin's post is worth reading.  Hat tip to my buddy Eric Van Horn for pointing it out to me.

Best foreclosure story ever.

See here.  Hat tips to Marc Stern, Chicago's Real Law Blog, and The Daily Show.  Students lucky enough to get Professor Porter for a course should discuss it with her.

(update) WONDERFUL column on Enron's former directors.

See the Deal Professor's column in today's New York Times (here).

UPDATE (or why I shouldn't monitor my blog before 6:15 a.m.)--my buddy George posted a great comment, which I accidentally deleted, so here it is:

While I do not think all of the folks mentioned in the article are as pure as the driven snow, there is a thinly veiled assumption that they knew what was going on when bad things were happening and turned a blind eye. I think it is premature to indict them in the media when they were probably lied to like the unlucky investors in those companies (or would any of you like some of our Lehman Brothers stock?).

Me:  George, I'm sure that they were lied to.  There's no way that they weren't.  The question that I have (and one that I don't know how to answer) is how boards can pierce through any lies that their managers throw their way, especially when they assume that their managers are the good guys.  If you post another comment, I promise to have had coffee and won't accidentally delete it!

I didn't think that Elizabeth Warren could get any cooler. I was wrong.

See today's Doonesbury strip here.  Based on this strip, her appearances on The Daily Show, and Joe Nocera's columns about her (like this one, here), she has officially become the coolest law professor ever.  If I were a Massachusetts resident, I would be delighted to campaign for her Senate run (should she choose to run).