At this week’s SCCE Compliance & Ethics Institute, WorldCom whistleblower Cynthia Cooper told attendees her hands shook as she pursued the audit questions that would help bring down the company. CCI’s Jennifer L. Gaskin reports on the courage it takes to speak up and the values that hold when profit pulls the other way.
Cynthia Cooper didn’t set out to implode one of the world’s largest telecom companies, Wall Street and business media darling WorldCom. But as she made her way from office to office in the summer of 2002 seeking answers about what “prepaid capacity” meant in the company’s balance sheet, WorldCom’s vice president of internal audit was helping set in motion a chain of events that would send the company into bankruptcy and its CEO to prison.
This year marked 25 years since the collapse of Enron (followed the next year by WorldCom) and, coincidentally, featured the 25th annual Compliance & Ethics Institute hosted by SCCE, where Cooper detailed a whistleblowing journey that would pit her against WorldCom’s CFO and the chair of its audit committee.
Cooper didn’t describe herself as fearless; in fact, quite the opposite.
“I can’t tell you I was this pillar of strength through this entire process. I wasn’t,” she told a session of conference attendees. In fact, at times, she says, her hands shook and her heart pounded. But she knew she had to find a way to push through.
The fear of speaking truth to power is one compliance professionals know, too, Cooper said, recalling advising a young compliance professional who reported being intimidated by executives with assertive and aggressive personalities: “You walk through that fear. You just do it anyway. And you ask the questions even if your voice is shaking.”
What carried Cooper through, she said, were her personal values, including her mother’s admonition to never feel intimidated.
Values were a theme in a general session earlier in the day, when Piergiorgio Pepe, former compliance and ethics director at AbbVie in Paris, argued that values matter in all types of corporate situations but often are obfuscated or (as in the example of WorldCom) totally ignored in the pursuit of profit.
He pointed to the rapidly evolving, or de-volving as the case may be, state of corporate DEI, which is quickly falling out of favor. What other conclusions should employees draw, given that just a few years ago, leadership was crowing about inclusion being a corporate value, he asked?
“You cannot tell me that this was a fundamental value and all of a sudden it’s disappeared from the code of conduct. How trustworthy are you as a leader?”
Durable values in a negotiable world
The retreat from DEI is part of a broader shift in the business world from one that centers a variety of stakeholders to one in which “rules are flexible if inconvenient,” Pepe said, and where the short term is more important than the long term.
Compliance has sometimes played into the problem, Pepe argued, by focusing too much on making the case that compliance is a business advantage. True, he said, but only useful insofar as it helps open doors to more substantive conversations. It can’t be the final message, Pepe said.
The final message, he said, must be: “Doing the right thing is the right thing to do regardless of whether it makes money or not.”
For compliance and ethics practitioners, that means not simply explaining what the rules are but why they exist, Pepe said. People who understand the underlying reasoning, linked to the company’s values, will begin to operate as if the reasoning is their own.
It also means elevating values to the same level as other mission-critical terms like financial targets — not relegating them to the bottom of the slide deck — and making sure leaders’ actions match their messaging. A year-end note about integrity rings hollow if two weeks later, a manager known for mistreating subordinates gets a shiny new promotion.
Mostly, though, making sure companies actually live up to their values is uncomfortable work, so E&C professionals need to be OK with that, Pepe said.
“There’s no ethical work without discomfort, my friends,” he said.
What whistleblowers need
Cooper shared the stage with Jane Norberg, a former chief of the SEC’s whistleblower office, and Carrie Penman, now an executive at software company NAVEX, who was the first ethics officer at Westinghouse. Penman recalled answering the company’s hotline calls herself early in her career and hearing the fear in reporters’ voices.
“It is a very, very difficult decision for somebody to come forward and raise an issue,” Penman noted, urging session attendees to remember that when they engage with possible whistleblowers.
One of the biggest reasons employees don’t come forward, research has shown, is the fear of retaliation, but what companies do in the earliest moments can be everything. The first touchpoint with a reporter can “make or break the entire rest of the relationship,” Norberg said. She recommended acknowledging reports within 24 to 48 hours, thanking the reporter and, in cases where their identity is known, interviewing them before anybody else.
She also warned against a common corporate reflex: immediately sending the complaint to the person the complaint is about. Once the accused knows about the report, later actions regarding the reporting party can appear retaliatory, even if they’re not, Norberg said.
Still, Cooper said the negative consequences for whistleblowers are nearly universal in her experience, and she urged E&C teams to keep in close contact with people who come forward.
“Empathize with the person. Independence or confidentiality doesn’t mean that there should be no communication with the whistleblower,” she said. “So don’t isolate them.”
At this week’s SCCE Compliance & Ethics Institute, WorldCom whistleblower Cynthia Cooper told attendees her hands shook as she pursued the audit questions that would help bring down the company. CCI’s Jennifer L. Gaskin reports on the courage it takes to speak up and the values that hold when profit pulls the other way.
Cynthia Cooper didn’t set out to implode one of the world’s largest telecom companies, Wall Street and business media darling WorldCom. But as she made her way from office to office in the summer of 2002 seeking answers about what “prepaid capacity” meant in the company’s balance sheet, WorldCom’s vice president of internal audit was helping set in motion a chain of events that would send the company into bankruptcy and its CEO to prison.
This year marked 25 years since the collapse of Enron (followed the next year by WorldCom) and, coincidentally, featured the 25th annual Compliance & Ethics Institute hosted by SCCE, where Cooper detailed a whistleblowing journey that would pit her against WorldCom’s CFO and the chair of its audit committee.
Cooper didn’t describe herself as fearless; in fact, quite the opposite.
“I can’t tell you I was this pillar of strength through this entire process. I wasn’t,” she told a session of conference attendees. In fact, at times, she says, her hands shook and her heart pounded. But she knew she had to find a way to push through.
The fear of speaking truth to power is one compliance professionals know, too, Cooper said, recalling advising a young compliance professional who reported being intimidated by executives with assertive and aggressive personalities: “You walk through that fear. You just do it anyway. And you ask the questions even if your voice is shaking.”
What carried Cooper through, she said, were her personal values, including her mother’s admonition to never feel intimidated.
Values were a theme in a general session earlier in the day, when Piergiorgio Pepe, former compliance and ethics director at AbbVie in Paris, argued that values matter in all types of corporate situations but often are obfuscated or (as in the example of WorldCom) totally ignored in the pursuit of profit.
He pointed to the rapidly evolving, or de-volving as the case may be, state of corporate DEI, which is quickly falling out of favor. What other conclusions should employees draw, given that just a few years ago, leadership was crowing about inclusion being a corporate value, he asked?
“You cannot tell me that this was a fundamental value and all of a sudden it’s disappeared from the code of conduct. How trustworthy are you as a leader?”
Durable values in a negotiable world
The retreat from DEI is part of a broader shift in the business world from one that centers a variety of stakeholders to one in which “rules are flexible if inconvenient,” Pepe said, and where the short term is more important than the long term.
Compliance has sometimes played into the problem, Pepe argued, by focusing too much on making the case that compliance is a business advantage. True, he said, but only useful insofar as it helps open doors to more substantive conversations. It can’t be the final message, Pepe said.
The final message, he said, must be: “Doing the right thing is the right thing to do regardless of whether it makes money or not.”
For compliance and ethics practitioners, that means not simply explaining what the rules are but why they exist, Pepe said. People who understand the underlying reasoning, linked to the company’s values, will begin to operate as if the reasoning is their own.
It also means elevating values to the same level as other mission-critical terms like financial targets — not relegating them to the bottom of the slide deck — and making sure leaders’ actions match their messaging. A year-end note about integrity rings hollow if two weeks later, a manager known for mistreating subordinates gets a shiny new promotion.
Mostly, though, making sure companies actually live up to their values is uncomfortable work, so E&C professionals need to be OK with that, Pepe said.
“There’s no ethical work without discomfort, my friends,” he said.
What whistleblowers need
Cooper shared the stage with Jane Norberg, a former chief of the SEC’s whistleblower office, and Carrie Penman, now an executive at software company NAVEX, who was the first ethics officer at Westinghouse. Penman recalled answering the company’s hotline calls herself early in her career and hearing the fear in reporters’ voices.
“It is a very, very difficult decision for somebody to come forward and raise an issue,” Penman noted, urging session attendees to remember that when they engage with possible whistleblowers.
One of the biggest reasons employees don’t come forward, research has shown, is the fear of retaliation, but what companies do in the earliest moments can be everything. The first touchpoint with a reporter can “make or break the entire rest of the relationship,” Norberg said. She recommended acknowledging reports within 24 to 48 hours, thanking the reporter and, in cases where their identity is known, interviewing them before anybody else.
She also warned against a common corporate reflex: immediately sending the complaint to the person the complaint is about. Once the accused knows about the report, later actions regarding the reporting party can appear retaliatory, even if they’re not, Norberg said.
Still, Cooper said the negative consequences for whistleblowers are nearly universal in her experience, and she urged E&C teams to keep in close contact with people who come forward.
“Empathize with the person. Independence or confidentiality doesn’t mean that there should be no communication with the whistleblower,” she said. “So don’t isolate them.”
