Enron Whistleblower to Offer Lessons at Jindal School Lecture
Sherron Watkins, former vice president and key whistleblower at Enron Corporation, will deliver the Andrew R. Cecil Lecture on Wednesday.
Sherron Watkins, former vice president and key whistleblower at Enron Corporation, will share her insight on the importance of speaking out against unethical organizational practices when she delivers the Andrew R. Cecil Lecture on Wednesday at UT Dallas.
The 2001 Enron scandal obliterated $74 billion of shareholders’ investments and led to the Houston energy company’s bankruptcy. Watkins is the former vice president who alerted then-chief executive officer Ken Lay to accounting irregularities in financial reports. She was one of three whistleblowers named 2002 Persons of the Year by Time magazine and co-authored the 2003 book Power Failure: The Inside Story of the Collapse of Enron.
Presented by the Naveen Jindal School of Management in the Davidson Auditorium, her lecture will begin at 7 p.m., following a 6 p.m. reception. Dr. Gregory C. Dess, Andrew R. Cecil Endowed Chair in Applied Ethics, will introduce Watkins. Following the lecture, there will be a 15-minute Q-and-A session moderated by past Andrew R. Cecil Lecture speaker Richard Bowen, a Jindal School senior lecturer in accounting.
The event is the latest in a series examining the state of ethics and social justice in modern society. In an interview prior to the event, Watkins said her lecture will include her Enron story and how to spot an erosion in values at an organization. For her, the warning signs are pretty simple and pretty basic — and the same with every organization.
“You have very few opportunities to see the window into someone’s soul,” she said. “And issues always appear rather minor. Part of the lesson is that you can’t rationalize bad behavior, and you’re not supposed to blow off those minor things.”
Advance registration is recommended for this free lecture.
A reception will begin at 6 p.m. in the atrium of the Jindal School, followed by the presentation and Q-and-A in the Davidson Auditorium at 7 p.m.
In the 12 years since the fall of Enron, Watkins has talked to plenty of whistleblowers who have a sense of regret about what they have done because they feel they paid too high a price for it — especially if the aftermath of their decision involves career, financial and relationship difficulties.
“They’re really kicking themselves for the moral stance they took in speaking truth to power,” she said. “The problem is they are comparing their current situation with their life before the ethical challenge landed on their desk. They compare the two as if the ethical challenge never happened — which is a false comparison.”
The right comparison to make, according to Watkins, is: “How would I feel about myself if I had stayed silent? If I’m faced with that ethical challenge and I chose to ignore it, how would I feel about myself?”
Watkins offers this consolation to those whistleblowers who feel regret: “Staying silent is about the same as just going along.”
She also sees an incentive to take a stand for those who may face a choice between silence and retaliation in the future. The bounty program in Dodd-Frank offers whistleblowers anonymity and a bounty of 10 to 30 percent of monetary fines levied by the SEC, she said, which is attracting legal talent to the cause of the whistleblower.
Watkins offers words of warning to business leaders who would consider going the way of Jeffrey Skilling, the convicted Enron executive who got the stiffest penalty in that scandal. With the bounty and the anonymity provisions now available, she has seen an increasing number of people who now are financially and ethically motivated to report wrongdoing to the SEC:
“If you’re doing something wrong, you’re going to be found out,” she said. “Dodd-Frank has really changed the landscape.”
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