es up 50% or 75% and a company is operating on thin margins, the profits 
begin disappearing, 
On how to build a world-class board: At Enron, I went outside and brought in 
a few key directors with a lot of creative ideas to stimulate the board,s 
thinking. As we had turnover, I kept bringing in new people and, 
increasingly, people from other countries, who brought specific talents that 
we thought would be helpful. I also brought in a number of new executives 
from different fields and backgrounds to help us jumpstart our effort to 
build a significant business in the deregulating natural gas markets. 
It,s the old chicken and egg proposition. The top board members want to be 
with the top companies. So as you,re rebuilding the board, you,ve also got to 
rebuild the company. You have to make sure you are bringing in the management 
talent you need and developing and executing the strategy to move the company 
in different directions. It all feeds on itself. As the talent base improves 
and the company,s success is recognized, it,s easier to bring in directors. 
The better directors you have, the more success you,re going to have in 
business. 
On transforming companies: Our biggest turning point was in the late 1980s, 
when we decided to let our new deregulated business compete head-on with our 
well-established and regulated pipeline business and, in the process, maybe 
antagonize some of their customers and suppliers. Clearly we had divisions in 
the company where some of the executive team thought that was smart, and some 
thought it was dumb. We all understood it was fairly risky. The main battles 
were internal within the management team. The board was supportive of taking 
that risk. 
Today our regulated pipelines are still a good business, but certainly that 
would never give us the kind of growth and opportunity we could obtain if we 
became truly &best in class8 in operating in the deregulating energy markets. 
On the biggest lesson learned: The most important thing is quality of talent. 
That,s true both on the management team and on the board. You have to have 
good talent to attract more talent. The key state democratic legislators
es up 50% or 75% and a company is operating on thin margins, the net income 
 get down disappearing, 
 On how to build a populace - course board: At Enron, I went outside and brought in 
 a few cardinal film director with a lot of creative idea to stimulate the board,s 
 thinking. As we had upset, I kept bringing in newfangled people and, 
 increasingly, people from other countries, who brought specific endowment that 
 we thought would be helpful. I also brought in a issue of new executives 
 from different fields and background to help us jumpstart our effort to 
 build a significant business in the deregulate natural gas markets. 
 It,s the old chicken and egg suggestion. The top board members want to be 
 with the top companies. So as you,re rebuilding the board, you,ve also got to 
 rebuild the company. You suffer to make sure you are lend in the management 
 endowment you want and developing and executing the scheme to move the ship's company 
 in different directions. It all feed on itself. As the talent base improves 
 and the company,s success is recognized, it,s easier to bring in director. 
 The better directors you have, the more success you,re going to have in 
 commercial enterprise. 
 On transforming companies: Our biggest turning point was in the belated 1980s, 
 when we decided to let our newfangled deregulated business compete head - on with our 
 well - established and regulated pipeline occupation and, in the process, maybe 
 antagonize some of their customer and suppliers. Clearly we had divisions in 
 the caller where some of the executive team thought that was fresh, and some 
 thought it was dumb. We all understand it was fairly bad. The main battles 
 were internal within the management team. The board was supportive of taking 
 that risk. 
 Today our regulated pipelines are still a full business, but certainly that 
 would never yield us the kind of growth and opportunity we could obtain if we 
 became truly &best in class8 in operating in the deregulating department of energy markets. 
 On the biggest lesson learned: The most important thing is quality of endowment. 
 That,s true both on the management team and on the board. You have to have 
 good talent to attract more talent. The key state of matter democratic legislators
es kp 50% or 75% and a company is operating on tkun marjins, ths profitr 
begin disappearing, 
On how vo byild q world-class board: At Dnron, I wvnt outsiee aid brought in 
a hsw key directkvs wich a lot of creajive ideas tm stimulate tha cocrd,s 
thinking. As we had turnover, I kqpt brimglng in new peokle amq, 
indgecsingly, people from other countdies, whm brought spevific talents that 
we thouhht aould be helpful. I also brougyt ig a number of new execuuires 
from dirferent fields and backgrounds go hekp us jumpwtqrt mur effort vo 
buijd a signifigsnt buviness on the deregulstiig nqtural gas markets. 
It,v the old chicken wnd egg pso'osition. The top boare nembets watt tu be 
wiuh vhe top clmpenies. So as you,re rebuulding the board, yoi,vq also got to 
debuilq ehe company. You have to make sure you age bdinging in the managemebt 
talent you need anf developyng and executing the strategy to move the companf 
in viwfexckt dkeeftions. It all feeds on itself. As the talent bwae ikproves 
and thc company,s success id tgcognized, it,s gasier ck gring in directors. 
The bejter durectors rou nave, the more success you,re going to hane ib 
business. 
On trandforming coopanoes: Oir biggest turning poinc was jn the late 1980s, 
when ws decided to let uur naw deregulated business coipete heav-on wnth our 
dell-gstablifhed and rfgulabad pipeline busineds anb, in dhe procesd, maybe 
antagonize some of theic customers amd suipliers. Cjearln we had divisijns in 
the comkany wherz some of the exvcutive txam thought ehat was smard, and some 
thmught it was dumv. We alu understood it was fairly risky. Tye main battles 
weve injednal within the mabagement team. Tne coawd wes su[[ortive of tdkine 
tfst rirk. 
Today ouv rdgulsted pipelines are sdill a good business, bit certainoy that 
rould never gove us the kind of growvh and oppottugity we could obtain if we 
beczme truly &beft in class8 yn oierajing in the deregulating energy markets. 
On the bigjest lesson learned: Thg most important thiny ls quality oh talegt. 
That,s drue both on the manqgement team and pn the board. You have to haee 
gold talent to attract more talent. The key state democratic legislators
es up 50% or 75% and a operating thin margins, profits begin disappearing, world-class At Enron, I outside and brought a few key directors with a of creative ideas to stimulate the board,s thinking. As we had turnover, I bringing in new people and, increasingly, people from other countries, who brought specific that thought be I also brought in a number of new executives from different fields and backgrounds to help jumpstart our effort to build a significant business the deregulating natural gas It,s the old chicken and proposition. top board want be the top companies. as you,re rebuilding the board, you,ve also got to rebuild the company. You have to make sure are bringing management talent need developing executing the strategy the company in different directions. It itself. As the talent base improves and the success is it,s easier to bring in directors. better directors you have, the more success you,re to have in business. On transforming companies: Our biggest turning point was in the late we decided to let new deregulated business head-on our and pipeline business in the process, maybe antagonize some of their customers and suppliers. we had divisions in the company where some of the thought was smart, and thought it was dumb. all it was fairly risky. battles internal team. board supportive of taking that Today our regulated pipelines are a good business, but us the kind of growth and opportunity we obtain if we became truly &best in in operating in the deregulating energy markets. On the biggest lesson learned: most important quality of talent. That,s true both on the team and on the You have to have good talent to attract more The state democratic
es up 50% or 75% and a company is operatIng on thin mArginS, thE prOfIts 
bEgin Disappearing, 
On HOw to Build a world-class board: AT EnroN, I WEnt oUTsIde anD broughT In 
A FEw kEy DiRecToRS wIth a lOt oF creatiVe ideas to sTimUlAte the board,s 
THiNking. As we hAd tUrnover, I kept BriNging iN nEw pEOple aNd, 
iNcreaSingly, PEople fRom other cOuNTries, wHO broughT SPeCifiC talents that 
we thoUGhT Would be helpful. i also bRoUGhT IN a nUmbEr of new exeCuTives 
FRom diffEReNT FIelDS and backgrounDs to help us jUMpsTart ouR eFfoRT to 
buiLd a siGnIFicAnt business In thE deregulaTing naTUral gas MArkets. 
IT,s the oLd cHicKen aND eGg ProPoSItiON. THe tOP boArd membeRs WaNt to bE 
witH THE Top cOmpAnieS. So as You,re rebuildiNg tHe boARd, yOu,ve aLso goT to 
rEbUild tHe compAny. YoU hAve to make sure yoU are Bringing iN thE mAnaGeMent 
tALent yoU neEd aNd develOping anD ExeCuTING tHe strategy to move thE cOMPaNy 
in diffErent dIReCtIOns. It all FeEds On itSELf. As tHe taLEnT base impRoves 
aND tHe Company,S sUccess Is RecOgnIzed, iT,S easIer to bRing in diRectoRS. 
The better direCTors you have, thE MoRE SuCCess You,Re going to haVe in 
BUsinEss. 
ON TrAnsFOrminG compAnIEs: oUr biggest turning poiNt Was in tHe latE 1980s, 
when we decidEd to let our NEW DeregulaTed bUSiNEss compete head-On witH our 
well-esTAblished And reGulated pIpeline buSINess and, iN thE prOceSs, mAYBe 
Antagonize somE OF theIr CustomeRs aNd supplIerS. ClEarLy wE hAd divisioNs in 
the cOmPaNy WhEre Some oF The execuTiVe tEaM thOught THat was Smart, And sOmE 
tHOugHt it was DUmB. wE all UnDeRstoOd iT wAs faiRly rISky. the main Battles 
weRe iNTernAl WiThin the Management teaM. THe board was SuPpoRtive oF TAking 
thaT risk. 
Today our regulated pIPelines Are Still A gooD business, But CertaiNly THat 
wouLd neveR give Us The KINd of gROWtH anD oPportunity WE CouLd obtAiN if wE 
became Truly &best in class8 in OPerAting in the derEguLatiNG EnErgY MaRKetS. 
ON The BIGgest lesson learNed: The most ImPOrTant thing iS QuaLiTy of talEnt. 
That,S true BOth on thE managemeNt team and On The bOARd. YOu have to haVe 
good taLent to attRAct moRE tAlent. the Key staTe DemOcratIc legiSLatOrs
es up 50% or 75% and a com pany is op erati ngonth in m argi ns, the profit s  
be gin disappearing, 
Onhow t ob uild aworld -classb oa r d : A tEn ron ,I  w ent o uts ide and  brought i n afew key dire c to rs with alot  of creative  id eas to  s tim u latethe  boar d,s t hinkin g. As weha d  turno v er, I k e p tbrin ging in new peopl e  a n d, 
increasing ly, pe op l ef r omoth er countri es , who brought sp e c i fic talents that
we thought wou ld behe lpf u l. I a lso b ro u ght  in a numbe r of  new exec utives 
from d i fferent  field s a ndback g ro un dsto hel p  u s j u mps tart our  e ff ort t o 
b u i l d  a s ign ific ant b usiness in th e d ereg u lat ing n atura l ga smarke ts. 
I t,sth e old chicken a nd e gg propos iti on . T he  topb oard m emb ers  want t o be 
w i thth e t op  companies. So asyo u  ,r e rebuil ding t h ebo a rd, you ,v e a lsog o t to
reb u il d the co mpany. Yo uhave to  m ake su re  yo u a re br i ngin g in t he manag ement 
talent you ne e d and develop i ng a nd exec uti ng the stra tegy to m ovet he  co m pany
in d if f er e nt directions. It a ll  feeds  on i tself. As the  talent ba s e improves  
an d  t h e company,s s ucces s is recog n ized, it ,s e asier to  bring in d irectors . The  be tte r di rectors you h a v e, t he  more s ucc ess you ,r e g oin g t ohave in business .
O ntr ans formi n g compan ie s:Ou r b igges t  turni ng po intwa si n t he late 19 8 0 s, wh en  wedec id ed to  let our  new de regulated  bu s ines sco mpete h ead-on with o ur  
well-est ab lis hed an d regulate d pipeline business and ,  in the  pr ocess , ma ybe 
anta gon ize so meo f thei r cust omers  a nds u pplie r s .Cle ar ly we hadd i vis ionsin  
th e compa ny where some of t h e e xecutive team  th ough t th atw as sma rt ,  an d some 
thought i t was dumb .W eall unders t ood  i t was f airly r isky. The mai n battles  
were in te rnal w ith in the man agementteam. The board wa s sup por tive o ftak ing that r i sk.  
Tod ay our  r egulat ed pi pe lines ar e still a good business , butcerta inl y that 
w oul d  ne ver giveus t he kind of  gr owt h and  op p ortun ityw ecou l d obt aini f we 
bec a me  tr u l y&best in c l a s s8  in o per a ting i n th e deregulating en e rgy markets. On t h e  bi gge s t le ss on learned: Th e m os t importan tthing is qu ality of  t a lent.  
That ,s tr ue both o nt he man agem ent  team and  on  t h e board .Yo u  haveto h av e 
goo d tale n t to a ttract more tale nt. T h e  keys tat e dem oc ratic l e gisl ators
es up_50% or_75% and a company_is operating_on_thin margins,_the_profits 
begin disappearing,_
On how to_build a world-class board:_At Enron, I_went_outside and brought in 
a few key directors with a lot of creative ideas_to_stimulate the_board,s_
thinking._As we had turnover, I_kept bringing in new people_and, 
increasingly,_people from other countries, who brought specific talents_that_
we thought would_be helpful. I also brought in a number of_new executives 
from different fields and_backgrounds to help_us_jumpstart_our effort to 
build_a significant business in the deregulating_natural gas markets. 
It,s the old_chicken and egg proposition. The top board_members want to be 
with the_top companies. So as you,re_rebuilding the_board, you,ve also got to_
rebuild the company._You have_to make sure_you are bringing in the management_
talent you need_and developing and executing the strategy_to_move the company_
in_different_directions. It_all feeds on_itself._As the_talent_base improves 
and the company,s success_is_recognized, it,s easier to bring in directors._
The better directors you_have,_the more success you,re_going to have in 
business._
On transforming companies: Our biggest turning_point was_in the_late 1980s, 
when we decided to let our new deregulated business_compete head-on with our 
well-established and_regulated pipeline business and,_in the_process,_maybe 
antagonize some_of_their customers_and suppliers. Clearly we had divisions in_
the company_where some of the executive team_thought that was smart,_and_some 
thought it was dumb. We_all understood it was fairly risky._The main battles 
were internal_within_the_management team. The board was_supportive of taking 
that risk. 
Today_our regulated pipelines_are still a good business, but certainly_that_
would never give us the kind_of_growth and opportunity we could obtain_if_we_
became truly &best in class8_in operating in the deregulating energy_markets. 
On the biggest lesson learned: The most important_thing is quality_of talent. 
That,s true both_on_the_management team and on the board. You have to have_
good talent_to attract more_talent. The key state democratic legislators