Enron Documentary Film Hits Select Theaters

When Enron, the seventh largest company in the country, collapsed into one of the decade's biggest business stories, Fortune reporters Bethany McLean and Peter Elkind expanded their coverage of the scandal into a bestselling book, The Smartest Guys in the Room: The Amazing Rise and Scandalous Fall of Enron.

Today, their book has been expanded into a documentary film that opens in Houston and New York City theaters this Friday, spreading in the following weeks from Pleasantville, N.Y., to Pasadena, Calif. Associate Editor Vandana Sinha speaks to McLean about her take on Emmy Award-winning producer and director Alex Gibney's vision, and how a one-time household energy company came to star in a movie house near you.

How did the idea of this movie come about?

It's actually kind of small-world story. Alex Gibney's sister-in-law is the head of communications at Fortune. She suggested that Alex read the book. He's an experienced filmmaker. He did "The Trials of Henry Kissinger." He saw in the story the same thing Peter and I had, that it's really a story about people, not a story about numbers. He knew that would be translatable to a movie. We all had a meeting to discuss whether that was viable or not. That was about a year ago.

What was Gibney's reasoning for making the movie? What does he hope to accomplish?

I think he wanted to bring the Enron story to a wider audience. More people are probably going to see a movie than read a book, if you do the movie right. And I think he thinks it's a comment on the business culture and on the larger culture today. And that it's important to spread that story. And I think he wanted to make an entertaining movie. And the Enron story has the classic components of a great story.

What do you hope it will accomplish?

When we started this, it was just really nice to have someone interested in our book. I didn't really have a list of things to accomplish. Of course, there's more that you can address in a 400-page book than you can in a movie. So it's great to give our book more exposure.

But I think the lessons of Enron are important for the business world. After we had all of the corporate scandal in 2002 -- Enron, WorldCom, Tyco -- we all wanted to say that it was a natural reaction to the excess of the bull market. But now those scandals have passed and now, when we look at companies like Fannie Mae, we know there's something flawed about the corporate culture today. There's a problem with an obsession with stock price and stock options, and it continues today. It's important for people to be aware of that. That it's a lie that individual investors can compete on equal footing with Wall Street, and everything is democratized. Look at Enron -- everyone lied to you, from Wall Street to analysts to bankers. You can't always trust them. You can't just trust companies, and it's important for people to not to be naïve. I'm not saying you can't trust everybody. But it's good for people to see that not everything is what it seems.

What has been the reaction so far to the movie at screenings you've attended in Houston, New York and Los Angeles ?

It's interesting. The vibe in Houston is definitely different than other places around the country. At other places, there's still a lot of rage against Enron. And you can have a lot of questions about corporate culture. But you don't get a lot of people defending Enron. Houston was one of the few places where you have someone defending Enron. An audience member there was saying, "Well, you still don't know," and defending the company. I finally said at the end of the night that it's amazing, the self delusion that still exists. This is not a debate about whether this was a good or bad company. It went bankrupt. Investors at most got 20 cents on the dollar. There's not a lot (of room for debate) there.

What do you say to criticism of the points you and Peter make in the book and movie?

Peter and I had struggled with this. Everyone has a line of argument about why this wasn't their fault. And each is actually kind of believable. You can embrace that logic. We even made the title of the chapter where we wrote about that, "Isn't anybody sorry?" But if we take all of those arguments, and we agree that everyone did everything right, then we are saying that Enron was an accident. That America's seventh largest company can have a stock price of $180 one month and be bankrupt the next and can have financial filings that totally don't represent the company, and that's nobody's fault. I can't subscribe to that thought. Someone has to take responsibility. You can't be a CEO who takes $300 million in compensation out of company and then say to the rest of us, "I didn't know." You have got to have greater moral responsibility than that.

How would you rate the movie yourself?

I think it's really good. It's amazingly difficult to take a subject as complex as Enron and translate it into a film that people really want to see. It explains what happened at Enron, not only in its financial details, which nobody really wants to see, but also how a culture like that can lead to a company's collapse.

How did it portray you and Peter?

Well, we portrayed ourselves. It filmed me and Peter in our homes. We had no make-up. It's always an awkward experience for print journalists to be on film. You want to say, "I don't look like that." Or "I don't sound like that." It just makes you think, "Oh my god." But it is what it is.

Is there any point where the movie veers from your book?

The only place where it was different from the book is that it is more political than our book was. Alex has defended that. I've heard him say that it's the job of a filmmaker to be an agent provocateur. To make people think by juxtaposing events and making people say, "Hmmm, is that possible?" That's a really valid thing for a film to do.

What impact do you think this movie will have on Ken Lay's trial?

I don't think it will have an impact. I think documentary filmmaking, like journalism, should reflect the world and make people think. I don't think journalism should be an actor in events, but instead just be chronicling events. Maybe that's not entirely accurate, given that stories can provoke action. But I think in this case, the citizens on this jury will be looking at things very separate from the issues in the film. In the film, like in the book, we take a very clear view of guilt, but I would never say that Ken Lay and Jeff Skilling are criminally guilty. I don't know if they're criminally guilty. Criminal guilt is a complex legal term with minute distinctions. But I do think they are ethically guilty. And that's what the book says, that they're ethically guilty.

You can hear McLean speak about her investigative reporting tips and techniques at the Reynolds Center at API's Cycle II "Investigative Business Journalism" workshop in Philadelphia next month. For more information, or to register, click here.

Copyright © 2008 Donald W. Reynolds National Center for Business Journalism