When Portland General was acquired by Enron Corporation, Joe Hirko was CFO. As CFO, he had a reputation for being honest, scrupulous, and conservative. I wonder if Jeff Skilling had fired Fastow and put Hirko in the CFO chair at Enron Corporation, what would the trajectory look like? When I think of a few pivotal moments that could have changed things, none paint so dramatic a picture as this hypothetical.
Joe Hirko had the trust of Wall Street. When things started getting sketchy after 9/11 and commercial paper was hard to roll (for anyone), I think Hirko could have bolstered confidence. He was known for his good judgement where Fastow was known for his risk-taking. In that post-9/11 environment, the good judgement would have been invaluable. Paper would have rolled; the decline in stock price might have abated somewhat, and Hirko’s assurances would have gone far to soothe nervous counter-parties.
Joe Hirko would not have stolen money – ever, under any circumstances. There would have been no highly publicized firing of the CFO from the company, which would drive prices down even farther. Instead, Hirko would have provided consistent, steady leadership.
With Joe Hirko as CFO, the LJM and Raptors probably would have still existed. There was nothing wrong with them – legally or accounting-wise. But some of the transactions were risky. I am thinking specifically of Osprey – which would trigger the financial collapse. I don’t think Hirko would insure one asset with the price of Enron stock over the long term; that just doesn’t sound like his style. So when the stock price did decline, it would be felt as a pinch, not as a wall of bricks crumbling upon the company.
LJM would have been better managed.
Ben Glisan probably would never have acquired the Treasurer position. That might have kept him out of the Southampton deal.
Sherron Watkins may have never written that memo to Dr. Lay in August 2001. If she had, she would not have been moved from Global Finance to Human Resources to protect her from Andy Fastow. I’m not sure what impact her remaining in Global Finance might have had but I am sure there would have been some effect.
In Enron Broadband Services, Ken Rice would have been full CEO instead of sharing the role with Joe Hirko. I decline to speculate on what might have become of EBS with just Ken Rice at the helm.
In any case, the Enron story would have been completely different. Today, instead of a man condemned to prison for sixteen months, Mr. Hirko might very well be CEO of Enron Corporation. Implying, of course, Enron Corporation would still be here.
