The good that came from the Enron collapse….

Tell me something worthwhile about Enron.

You might be slightly bemused, unsure if this is a trick question. Most likely struggling. The strange reality is Enron has had a huge impact on our lives in ways most of us are ignorant of. Whether that is beneficial depends on your perspective.

Enron was founded in 1985 by Kenneth Lay through the merger of two regional natural gas transmission companies in the US. Shaped by Jeffrey Skilling (initially a consultant and later the Chief Operating Officer and Chief Executive), ‘Enron transformed itself into a trader of energy derivative contracts, acting as an intermediary between natural-gas producers and their customers. The trades allowed the producers to mitigate the risk of energy-price fluctuations by fixing the selling price of their products through a contract negotiated by Enron for a fee. Under Skilling’s leadership, Enron soon dominated the market for natural-gas contracts, and the company started to generate huge profits on its trades’. (www.britannica.com)

Enron was the poster boy of the 1990’s corporate world as success encouraged its expanded use of the derivative contract into other commodities. By the year 2000 It was a Fortune 500 company buoyed by investors and a very accommodating auditor, the firm Arthur Anderson. But in 2001, with assets of more than $63bn it collapsed into bankruptcy due to corporate fraud. As competition shrunk profits, Enron employed dubious accounting policies included hiding losses in off balance sheet special purpose vehicles so they were not easily discoverable and bringing forward profits that had not yet been realised. At the time of filing it was the largest corporate default in US history; eventually a notable number of employees were jailed.

The Enron corpus was a database of over 600,000 emails produced by 158 mostly high ranking employees in the years up until its collapse in December 2001. The archive included business discussions, personal banter around holiday plans, relationships, requests to be unsubscribed from mailing lists, flirtations and even the breakdown of a marriage.

These collected missives were required by the Federal Energy Regulatory Commission (FERC) forming part of the evidence that criminally convicted Kenneth Lay and Jeffrey Skilling for price manipulation. Post sentence, the FERC released the emails for public perusal forming one of the largest collation of private emails accessible for general consumption. In its issued state the compilation was too much of a jumble to be useful. A researcher from MIT bought the database and skilfully re-structured the archive into date order organised by folders. He removed emails concerning delivery failure, automated responses and duplicates. By 2004 this had transformed the disarray of communications into a treasure trove of unfiltered human behaviour originating from an organisational setting.

When you stop to consider, you’ll understand this abundance of voyeuristic knowledge is awkward to replicate naturally — and even more so now in the world of hyper privacy controls we pertain to live in. So not surprisingly this wealth of intelligence has been dissected by multiple human minds and software, in the process spawning more than 3000 research papers and 100 projects. It has assisted in the development of algorithms that have fostered spam filtering software, artificial intelligence, counter terrorism applications. Forging understanding of on-line habits, how people communicate and how gender and power manifest in an organisation. These are some of the more specific projects it has been or rumoured to have been utilised to advance :

• Informing artificial intelligence researchers as to how humans talk — the prototype of gmail’s ‘smart compose’ feature was trained on the Enron corpus
• The early versions of Apple’s Siri was developed by a few of the researchers from the MIT team working with the initial archive
• A benchmarking study on email folders to understand if machine learning could replace humans to build email folders (not yet — we are too idiosyncratic)
• Helping us understand how viruses spread through populations
• Identifying terrorist cells through phone records by understanding how networks (across a group of people) function

I think you’d agree, this batch of information has been incredibly influential. But we can question whether these emails reveal society or a sub-set of society — ‘people who thrived at a morally compromised US corporation in the late 1990s and early 2000s’ (Yahoo finance). This data set was and is used to train artificial intelligence systems employed today and hence the flaws or biases of that group of people will be perpetuated through our systems. Also morally (and it is hard to put moral and Enron in the same sentence!) none of the writers of the emails were consulted as to how they felt about private compositions being made public. This does not sit well when you contemplate some of the dramatic personal events that unfolded over email for a portion of the people who worked there.

An art project called ‘The good life’ signs you up to receive an edited selection — 225,000 emails of the Enron archive (https://enron.email). I was quite tempted until I realised that even receiving 49 emails a day, it would still take me 28 years to read them all. The voyeur in me is tempted…but perhaps I should get a life….