Internal speak-up lines are a sound way for companies to prevent financial and reputational damage
If Cynthia Cooper and Sherron Watkins had been taken seriously, big corporate disasters could have been averted. Billions of dollars in shareholders’ money could have been saved.
Cooper, vice-president for internal audit at WorldCom, alerted the telecoms company’s board in 2002 to a massive internal accounting fraud. Her concerns were ignored by then WorldCom chief financial officer Scott Sullivan and the company’s auditor, Arthur Andersen. By the time Cooper was vindicated, it was too late. A $3.8 billion hole in the accounts left WorldCom bankrupt and 17,000 employees jobless.
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