Governance
August 24, 2026
Corporate governance: between control and responsibility
What corporate crises and mistakes made in the Enron, FTX, and Americanas cases can teach
A company may have a board of directors, independent audit, audit committee, code of conduct, compliance policies, and dozens of control mechanisms, and still head towards collapse. The nagging question is: if all these mechanisms exist, why do major corporate crises continue to happen?
The answer may lie less in the absence of rules and more in the ability to make them work. Enron, FTX, and Americanas are different stories, separated by countries, sectors, and decades. But there is a common element among them: relevant information was not adequately questioned, controls were insufficient, or oversight mechanisms failed to prevent risks from turning into crises.
And the consequences were not restricted to the balance sheets. Companies lost value, investors were affected, employees were exposed, creditors suffered losses, and executives had their professional trajectories and, in some cases, their own freedoms, profoundly affected.
This is why corporate governance should not be understood merely as a collection of rules designed to produce reports, meet regulatory requirements, or satisfy the market. Governance is, above all, a system of power, control, and accountability.
The principles of governance
The Brazilian Institute of Corporate Governance (IBGC) defines corporate governance as the system by which organizations are directed, monitored and incentivized, involving relationships between shareholders, board of directors, management, control bodies, and other stakeholders (IBGC, 2023).
In its 6th edition, the Brazilian Corporate Governance Code of Best Practices establishes five principles: integrity, transparency, equity, accountability, and sustainability (IBGC, 2023). These principles, however, only have value when they manage to influence decisions.
Integrity must appear when there is pressure for results. Transparency must exist when information is unfavorable. Equity must prevail when powerful interests are involved. Accountability must reach those who hold decision-making power. And sustainability must consider the impacts of decisions beyond the immediate result. It is at this point that governance ceases to be a concept and becomes practice.
Enron: crisis of confidence
In 2001, Enron Corporation collapsed after serious accounting, internal control, and financial disclosure problems came to light. Executives used complex structures and related entities to hide liabilities and present a financial situation different from reality to the market (SEC, 2003; SEC, 2004).
The case became a landmark of corporate governance because it demonstrated that a fraud of great proportions does not depend solely on the action of an individual. It can thrive when oversight, auditing, controls, and accountability mechanisms fail to function.
The consequences went beyond the company. The bankruptcy affected employees, investors, and creditors and contributed to a crisis of confidence in the North American markets. Executives were sued and convicted, while Arthur Andersen, responsible for Enron’s audit, also suffered consequences that contributed to the end of its operations as one of the country’s leading auditing firms (Thomas, 2002). The case showed that controls can exist formally and still fail in the face of an organizational culture driven by results and inadequate incentives.
FTX: new models, old risks
In 2022, the collapse of FTX demonstrated that new business models do not eliminate old governance problems. Headquartered in the Bahamas, FTX had achieved a prominent position in the crypto-asset market. The Securities and Exchange Commission accused Sam Bankman-Fried of misappropriating funds from FTX clients to Alameda Research and of providing misleading information to investors about the financial situation of the companies (SEC, 2022).
The consequences for the founder were severe. In March 2024, Bankman-Fried was sentenced to 25 years in prison and ordered to forfeit $11 billion, according to the U.S. Department of Justice (DOJ, 2024).
The case highlights risks associated with the concentration of power, the absence of adequate controls, and the insufficiency of independent oversight mechanisms. The technology was new. The governance problem was not.
Americanas: the signs that governance cannot ignore
In Brazil, the Americanas case has become one of the main recent examples of the relationship between governance, internal controls, financial information and market trust. In January 2023, the company informed the market of accounting inconsistencies amounting to R$ 20 billion, triggering investigations and leading the company to judicial recovery proceedings (CVM, 2023).
The consequences went beyond shareholders. Creditors, suppliers, employees, and investors were affected by a crisis that took on financial, reputational, and institutional dimensions.
In 2026, the CVM reported the continuation of investigations and proceedings related to the case and initiated new inquiries, including to ascertain possible responsibilities of administrators and members of governance bodies (CVM, 2026).
Therefore, it is important to differentiate investigation from condemnation. The case has developments in different instances. The governance issue remains: what signals should have been identified, questioned, and escalated before the problem reached that dimension?
SOX: high management responsibility
The major corporate scandals of the early 2000s produced a significant regulatory response in the United States. In 2002, the Sarbanes-Oxley Act, known as SOX, was passed with the aim of strengthening the reliability of financial information and restoring investor confidence.
The legislation reinforced the responsibility of senior management for the information disclosed by companies. CEOs and CFOs began to certify certain financial reports, while companies became subject to more stringent requirements related to internal controls and the disclosure of material deficiencies (United States, 2002; SEC, 2003).
SOX also strengthened audit committees, auditor independence, and oversight of internal controls. Its effects remain embedded in the regulatory environment of companies subject to U.S. rules, becoming a permanent benchmark for controls, auditing, and corporate accountability (SEC, 2003; SEC, 2026).
Your logic can be related to four fundamental dimensions: compliance, accountability, disclosure, and fairness. Compliance represents the fulfillment of laws and regulations. Accountability involves responsibility. Disclosure enhances information transparency. Fairness seeks to ensure fair treatment for different shareholders and stakeholders.
SOX demonstrates that good governance practices are not static. They evolve from failures identified in the market and remain relevant as long as the risks they seek to address continue to exist.
Governance as practice
Governance can also be observed in the way some organizations structure their mechanisms for oversight and distribution of responsibilities. Natura, for example, maintains a board of directors and advisory committees, including the audit, risk management, and finance committee.
The body monitors internal and external audit processes, risk management, and financial matters, creating an instance for monitoring corporate information and controls (Natura, 2026). The existence of these instances allows for the separation of functions, establishment of responsibilities, and creation of formal spaces for analysis and questioning of management decisions.
At WEG, the governance structure also includes a board of directors, a fiscal council, and a statutory audit committee. These bodies have distinct oversight, monitoring, and advisory responsibilities, establishing different levels of supervision over the company’s management (WEG, 2026). The distribution of these responsibilities creates mechanisms for information, risks, and decisions to be analyzed from different perspectives.
Mechanisms
Among the main mechanisms of good governance are an active and independent board of directors, audit committees , internal and independent auditing , internal controls, risk management, compliance[/3]], whistleblowing channels, transparency in information disclosure, and clear accountability mechanisms.
The case of Andrew Fastow, former CFO of Enron, helps to understand an additional dimension. Sentenced to six years in prison for crimes related to his performance at the company, Fastow later began to use his experience in lectures on ethics, governance, and decision-making, especially discussing the so-called gray areas, where a decision may seem technically permissible, but still be ethically inappropriate (Ivey Business School, 2019).
Your case should not be interpreted as a redemption story, but as a demonstration of the consequences that can accompany decisions made when controls, ethics, and responsibility are relativized.
Ultimately, governance is not just about having bodies, policies, and documents. It requires continuous effort to ensure these mechanisms function. Directors need to question. Executives need to be accountable. Auditors need to preserve their independence. Committees need to investigate red flags. Investors need to analyze information. And organizations need to create environments where raising a concern is not treated as a threat, but as part of corporate responsibility.
The fundamental question, therefore, should not be just whether an organization has governance. We should ask whether the people who exercise power within it are willing to respect, oversee, and, when necessary, confront their own decisions. Because governance is not just what is written in the company’s code. It is what the organization actually does when it needs to choose between immediate results and long-term responsibility.
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Who wrote this column
Rodrigo Thomaz
