TY - JOUR T1 - Five Red Flags Over Texas JF - Special Issues SP - 70 LP - 79 VL - 2003 IS - 2 AU - Charles M. Elson AU - Christopher J. Gyves Y1 - 2003/09/21 UR - https://pm-research.com/content/2003/2/70.abstract N2 - A dramatic change in approach to corporate board composition, conduct, and responsibility has occurred at the legal and regulatory level, largely in response to a perceived failure by the Enron board to have prevented management conduct that led to the company's downfall. Because the Enron board had significant relationships with company management, both transparent and latent, it had difficulty recognizing numerous warning signals including waiver of the company code of ethics, stock sales by executives, external auditors taking large consulting fees and engaging in internal audit work, and individuals in the company's finance department with connections to the external auditor. The key common element of the numerous resulting governance mandates following Enron and other corporate incidents has been a focus on the independence of corporate directors. ER -