Leadership Lesson From A Cheater


Imagine you are holding hundreds of stocks of a company. In fact, you believe in this company. And why not? After all you work at this company, a company which Fortune magazine calls “America’s Most Innovative Company” for six consecutive years! You believe in yourself, and you believe in the company so much that you invested all of your retirement savings in this company stock.  The job is doing fine, and the stock is nicely appreciating. In fact your company is doing so well it is called a Wall Street darling.

You were happy as you watch the stock chart. In just three months, it has gone from about $40 to $60+. In another 6 months it reached $90! Should you sell? May be not yet you think. At this rate, you can be a millionaire much sooner than you thought. May be retire early? You can’t keep up with the options on how to use the money when you will cash out the stocks.

But something went wrong in the next 4-6 months and the stock is back to $60. There are some stories in Wall Street Journal about the financials of your company, but the CEO released a statement that there is nothing wrong. Before you think to get out of the stock, in the next 3-6 months it is back to 40, and then another month – $20. Now you are surprise, actually shocked. What is happening?

Another two months and the stock is trading at $1 – yes, a buck! The company has filed bankruptcy, and you may have lost your job!

If I tell you the time frame was early 2000 to end of 2002, and the CEO name was Ken, you might be able to connect the dots.

Enron collapse - Stock chart

The company was “ENRON”, and the CEO’s name was Kenneth Lay. ENRON filed bankruptcy in 2001 – largest one at that time in the history of Unites States (Worldcom broke that record the next year).

The worst outcome was thousands of workers lost their jobs and retirement and pension savings tied to the stock. It was devastating, and it was all due to the lack of integrity of the company management led by the CEO Kenneth Lay.  Misleading financial statements, tactfully hiding losses with the help of (dishonest) auditing firm Arthur Anderson brought the empire to collapse.

Before 2001, Ken Lay was considered a successful CEO. Ken Lay was found to be a cheater. The management was nothing but a fraud.

Would you call Ken Lay a leader?

We’ve discussed that the foundation of the leadership is based on the qualities of leadership. Those who do not possess such qualities will fail as a leader in the end, no matter what level of position they are holding.

Ken Lay proved that he lacked one of the basic qualities of a leader, Integrity, and he was ultimately not a leader. He was given a position as a CEO to prove himself as a leader, but he failed. He failed miserably and also adversely affected thousands of families.

Remember, the position someone has needs to be supported by integrity.

Leaders honor integrity.

Leaders do not compromise integrity.

The one who compromises is a cheater, not a leader.

Leader is a dish. You need different ingredients in terms of qualities to prepare the dish. Position is just a pan. It helps you make the dish. Pan itself is not a dish.

If you have a position –as a janitor, as a manager, as a CEO, respect it, honor it. That position does not make you a leader. That position just helps you prove your leadership skills.

Be honest. Have integrity. Move one step forward in the direction to be a leader.


R.D. Jani
R.D. Jani
R. D. Jani, MS, MBA, is an avid student and practitioner of leadership and management. RJ gained his over 20 years of experience by working and consulting at various Fortune 500 companies, including General Electric (GE), McGraw-Hill, Godiva, NBC, Citibank, Bank of America, TIME, and many others. He also runs his blog at and has authored a book - "Leadership Lessons from Business Legends." He can be reached at: [email protected]

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