Cynthia Cooper Reflects on WorldCom and the Power of Choice — Transcript

Full transcript

1. 0:00[Music]
2. 0:14hello i'm richard chambers senior
3. 0:15internal audit advisor for audit board
4. 0:17and welcome to another in my continuing
5. 0:19video series on agents of change i'm
6. 0:22joined today by someone who needs no
7. 0:24introduction cynthia cooper you know
8. 0:27cynthia is an internationally recognized
9. 0:29speaker and consultant and best-selling
10. 0:31author and advocate she's the ceo of
11. 0:34cooper group llc
12. 0:36in 2020 cynthia was selected by time
13. 0:38magazine to be included in 100 women of
14. 0:40the year times list of the most
15. 0:43influential women of the last hundred
16. 0:45years in 2002 we'll all remember that
17. 0:48she was named one of time magazine's
18. 0:50persons of the year for her role in
19. 0:52unraveling and reporting what would
20. 0:54become the largest corporate fraud in
21. 0:56history at worldcom cynthia it's so good
22. 0:59to be with you again you know it's been
23. 1:0120 years since we first met and
24. 1:04where has the time gone i know it i know
25. 1:06it's hard to believe it's been 20 years
26. 1:08yeah i i recall it wasn't long after uh
27. 1:12the worldcom
28. 1:13story broke that
29. 1:15that you and a colleague came and sat
30. 1:16down with bill bishop and i at the eye
31. 1:19and we spent an afternoon just allowing
32. 1:21you guys to kind of share the
33. 1:23experiences you'd been through and i
34. 1:25still remember those events like they
35. 1:27were yesterday i remember that that was
36. 1:29a poignant moment for me as well and
37. 1:31bill bishop was one of the first
38. 1:33people who reached out to me after the
39. 1:36worldcom fraud
40. 1:37along with joe wells of the acfe so very
41. 1:40very much appreciate the support that
42. 1:43you guys gave my team and me
43. 1:45during that very difficult time it was a
44. 1:48learning experience for me i came to the
45. 1:50ia
46. 1:51in at the end of 2001 and enron had just
47. 1:55happened and worldcom was about to
48. 1:56happen so i i felt like i was going to
49. 2:01clinic on on how corporate frauds unfold
50. 2:04and you were instrumental in helping me
51. 2:05understand that and i remember when
52. 2:07enron occurred the congress thought it
53. 2:10was just one bad apple yes and so
54. 2:13sarbanes-oxley was close to passing and
55. 2:16then they put the brakes on it that's
56. 2:17right and as i shared in a blog not long
57. 2:19ago it was what i consider the most
58. 2:22consequential audit in history maybe
59. 2:25internal audit in history that you guys
60. 2:27did that got everything rolling again
61. 2:29and got congress
62. 2:30fully committed to putting the kind of
63. 2:32legislation together that we needed you
64. 2:34know
65. 2:352022 being the 20th anniversary of
66. 2:38the world com debacle i'm sure you've
67. 2:41had a chance to reflect a lot
68. 2:43on that experience and and i guess my
69. 2:45first question to you
70. 2:47uh would be what do you think is an
71. 2:49overarching lesson or some lessons
72. 2:51really
73. 2:52for corporate america from the from the
74. 2:54worldcom
75. 2:56events yeah great question i i don't
76. 2:59think for me there's one overarching
77. 3:02lesson i think there are so many lessons
78. 3:05it's so multifaceted um one i think is a
79. 3:08lesson about human nature
80. 3:10that you know fraud has
81. 3:13been with us since the beginning of time
82. 3:15and will probably always be with us
83. 3:17right so
84. 3:18um i think we saw
85. 3:21looking at the common threads across not
86. 3:23only worldcom but enron and tycho and
87. 3:26all of these big scandals that a lot of
88. 3:28them
89. 3:29were driven by
90. 3:31pride and greed and fear and misguided
91. 3:34loyalty so behind the accounting
92. 3:36machinations of the fraud schemes
93. 3:39themselves these were really stories
94. 3:41about people and choices and when i talk
95. 3:44to students i tell them we all have the
96. 3:46power of choice right you can give it
97. 3:47away
98. 3:48but nobody can take it from you so
99. 3:50that's one of the lessons i think you
100. 3:52and i have talked before about culture
101. 3:54and certainly making sure that you have
102. 3:57a very strong
103. 3:59speak up transparent ethical culture is
104. 4:01important that's one of the things that
105. 4:03i think came out
106. 4:04the association of fraud examiners
107. 4:06indicates that over 50 percent of all
108. 4:08frauds are identified
109. 4:10through tips
110. 4:11and now of course the sec
111. 4:13has a bounty program as well as the cftc
112. 4:16and the irs and other organizations and
113. 4:19so it's just critically important that
114. 4:21companies make sure that they encourage
115. 4:24people to speak up to speak up early
116. 4:27the top two reasons people don't come
117. 4:29forward or
118. 4:30that they are afraid of retaliation and
119. 4:32they don't believe that anything will
120. 4:34happen and sadly you know there are a
121. 4:36lot of things that have improved in the
122. 4:37last 20 years but i i think some of what
123. 4:40you're describing you know there's still
124. 4:42there's still huge challenges and they
125. 4:44create great underlying risks for
126. 4:46organizations
127. 4:47absolutely
128. 4:49so as i look back on your career
129. 4:53as you so eloquently
130. 4:54shared in your book uh extraordinary
131. 4:57circumstances the journey of the
132. 4:58corporate whistleblower which by the way
133. 5:01i've read three times you know and i can
134. 5:03tell you and my wife will tell you if i
135. 5:05read a book once it's a miracle for me
136. 5:07to read a book three times that's truly
137. 5:09remarkable
138. 5:10so i think you've symbolized
139. 5:15two absolutely vital traits of an
140. 5:18internal auditor you you you brought
141. 5:20integrity and courage to your role how
142. 5:23do you differentiate between integrity
143. 5:26and courage and
144. 5:28how challenging was it in a place like
145. 5:30worldcom considering all the obstacles
146. 5:32you faced and and frankly as you've
147. 5:34already said i mean this is something
148. 5:36that people deal with all the time how
149. 5:38do you differentiate between challenge
150. 5:40between integrity and courage yeah to me
151. 5:43i view integrity as making sure that you
152. 5:46have well-defined moral values that you
153. 5:48know what you stand for
154. 5:50know what you believe in and that you
155. 5:52have the will and the courage to live by
156. 5:54those values so i think courage is just
157. 5:57simply one value integrity is a value as
158. 6:00well
159. 6:00and probably
160. 6:02one of the most important values because
161. 6:05if you can't find your courage then
162. 6:06obviously you can't stand up and and
163. 6:09live by your values when you find
164. 6:11yourself at a tough crossroads yeah i i
165. 6:14point out a lot i i've known i've known
166. 6:16very honest people who didn't have the
167. 6:19courage to call out
168. 6:22misbehavior or the courage to do
169. 6:25something
170. 6:26when they saw something that was clearly
171. 6:28wrong that was being done and i think
172. 6:31that's why it was so important for uh
173. 6:34for worldcom and for corporate america
174. 6:36to have someone like you who could bring
175. 6:38both of those to bear in those
176. 6:40extraordinary circumstances as your book
177. 6:42is so aptly titled
178. 6:43thank you
179. 6:44i i talk to as you know i talk to
180. 6:46students all the time but also next
181. 6:48generation
182. 6:49auditors and i i try to encourage them
183. 6:52to
184. 6:53find their courage and that we tell them
185. 6:56we all have courage within us we just
186. 6:58have to dig down deep and and find it
187. 7:00sometimes and you know in my book i try
188. 7:03to keep it very
189. 7:05real
190. 7:06i think it's important to be authentic
191. 7:08and vulnerable and i want people to know
192. 7:10that i was not this pillar of strength
193. 7:13through the entire process i'm very open
194. 7:15about that in the book
195. 7:17that there were times when i was fearful
196. 7:18and my hands were shaking
197. 7:20and and i think what helped me to find
198. 7:23my courage the most
199. 7:25was probably my mother so at a very
200. 7:28young age
201. 7:29she was telling my brother and me to
202. 7:32think about the consequences of our
203. 7:33actions but also she would always say
204. 7:36don't ever allow yourself to be
205. 7:37intimidated
206. 7:38and i think as much as anything that
207. 7:40probably her words
208. 7:42are what you know helped me to find my
209. 7:44courage at different points in my life
210. 7:46and the other thing is that i think it's
211. 7:48just important for all of us to
212. 7:51really be intentional about thinking
213. 7:53about what values
214. 7:55we want to live by who do we want to be
215. 7:59and writing our own personal mission and
216. 8:01vision statement oh that's so true you
217. 8:04know i tell
218. 8:06chief audit executives and i've done
219. 8:07this i think your book came out around
220. 8:092008 or 2009 and ever since then i've
221. 8:13been telling
222. 8:14people in leadership roles in internal
223. 8:15audit that they need to read your book
224. 8:18and at the end of that book if they
225. 8:20couldn't have done the same things you
226. 8:22did that they should ask themselves
227. 8:24whether they're in the right role
228. 8:26because i think that's that's what this
229. 8:27comes down to and as we both know that
230. 8:30if you're in the internal audit
231. 8:32profession
232. 8:33long enough you are going to find
233. 8:35yourself in positions of pressure you'll
234. 8:37find yourself in a position where
235. 8:40you're giving bad news and people don't
236. 8:42want to hear it so
237. 8:43it's really it really is part of
238. 8:46the career
239. 8:47and i think it's important to
240. 8:50get comfortable with being uncomfortable
241. 8:52yes at the very beginning of your career
242. 8:54that's an absolutely great way of
243. 8:56putting it you got to you've got to be
244. 8:58prepared for the worst and then you'll
245. 9:01never find yourself in a situation that
246. 9:03you can't handle absolutely you know one
247. 9:05of the most uh compelling aspects of
248. 9:08your story is that not only
249. 9:11did you have to face down powerful
250. 9:13executives that will come but you had to
251. 9:15do so without the enthusiastic backing
252. 9:18of your audit committee and that's
253. 9:19probably probably being kind
254. 9:22you know what advice would you give to a
255. 9:25chief audit executive in particular who
256. 9:28finds that they're in a difficult
257. 9:29situation trying to get a difficult
258. 9:31message forward
259. 9:33but aren't sure how it's going to be
260. 9:34received by the audit committee i think
261. 9:36my advice would be to
262. 9:39first of all continue going back to the
263. 9:40facts and
264. 9:42separate any emotion from the facts of
265. 9:46whatever the issue is
266. 9:47make sure that you do your homework
267. 9:49before you go into the audit committee
268. 9:52think about different ways that you
269. 9:54might be able to communicate the
270. 9:56situation because sometimes it's not
271. 9:58just what is said but how it's said so
272. 10:01communication can be very
273. 10:03important perhaps giving different
274. 10:05options if there are different paths
275. 10:06that can be taken for resolution i think
276. 10:09that's important but in the end it
277. 10:11really does come down to
278. 10:13just stepping up to the plate and
279. 10:15swinging your bat and doing what you
280. 10:18need to do
281. 10:20knowing that there may be a price to pay
282. 10:23and i think it's important to be willing
283. 10:26to to pay the price right it could could
284. 10:28be your job
285. 10:29it could be a promotion it could be a
286. 10:32cut in budget
287. 10:34but you
288. 10:36keep your integrity and that is
289. 10:39to me you go back to your very highest
290. 10:41value and sometimes our values can
291. 10:43collide so loyalty is an important value
292. 10:47you can't just go breaking rank
293. 10:50but it's not the highest value so the
294. 10:53highest value or one of the highest
295. 10:54values of course is honesty
296. 10:56transparency
297. 10:58and being true to your own values so you
298. 11:01know cynthia as i said i'm so impressed
299. 11:04not only with your courage and integrity
300. 11:06from
301. 11:07from the experiences that you that you
302. 11:09went through at worldcom but also the
303. 11:10leadership that you showed as the cae
304. 11:14i know that there were times where there
305. 11:16was a lot of pressure and a lot of
306. 11:17stress not only on you but on the entire
307. 11:20team there as that audit was being
308. 11:21undertaken and yet
309. 11:23i think it was your unwavering strength
310. 11:26that got them through it and it was that
311. 11:29leadership and i guess my question for
312. 11:31you
313. 11:31would be what leadership traits
314. 11:34in addition to
315. 11:36courage and integrity do you think chief
316. 11:38audit executives need to have let me
317. 11:40start just by saying that i was blessed
318. 11:42to have
319. 11:43an amazing team
320. 11:45and
321. 11:46an incredible leadership team any one of
322. 11:49my directors could have stepped right
323. 11:50into the chief audit executive position
324. 11:52so i decided early on that if i could
325. 11:55not hire many people that i would hire
326. 11:58the best
327. 12:00and most of my team they had you know
328. 12:02multiple certifications multiple degrees
329. 12:05highly qualified highly skilled team so
330. 12:08very fortunate very blessed to have that
331. 12:11team surrounding me but as far as
332. 12:13leadership skills that i think caes
333. 12:15should have not only caes but you know
334. 12:18senior executives directors managers in
335. 12:22audit departments
336. 12:24there are there are many i think strong
337. 12:26communication skills obviously is an
338. 12:28important one
339. 12:29i think
340. 12:31one of the most important things is
341. 12:33getting the right people in the right
342. 12:35seats let's face it i mean none of us
343. 12:37have everything right we all have our
344. 12:39strengths and our weaknesses and
345. 12:41historically there's been so much focus
346. 12:43on trying to improve your weaknesses but
347. 12:46when you think about it
348. 12:48the people who really excel and succeed
349. 12:51find what i call your three-point zone
350. 12:54so
351. 12:54what are you doing when you can easily
352. 12:57hit a three-point shot right and it's
353. 12:59just effortless
354. 13:01what are your what are your talents
355. 13:03things that just come naturally for you
356. 13:05what are your skills what are your
357. 13:07strengths and those of your team and
358. 13:09that way
359. 13:10you can
360. 13:12throw the ball to whoever's in the best
361. 13:13position to take the shot
362. 13:15you can
363. 13:17look at the strengths and skills across
364. 13:19your organization and see where you
365. 13:21might have gaps those kinds of things
366. 13:23cynthia it's been said that we learned
367. 13:25the most about ourselves in times of
368. 13:27adversity
369. 13:28and certainly
370. 13:30the adversity you went through i think
371. 13:31you chronicled in your book but but what
372. 13:34would you say that you learned about
373. 13:36yourself
374. 13:38in that period
375. 13:39that maybe you wouldn't have
376. 13:41seen about yourself before what did you
377. 13:44learn in 2002 that you that you can
378. 13:46recall
379. 13:47that's so true i think that
380. 13:50we learn the most sometimes in those
381. 13:52darkest of times and
382. 13:54and we all have our doors of adversity
383. 13:57you know if you live long enough yours
384. 13:58may be different than the
385. 14:00person sitting next to you but um but we
386. 14:03certainly all have our doors and for me
387. 14:05i mean to this day i can tell you that
388. 14:08going through what i went through at
389. 14:10worldcom was
390. 14:12the most difficult time in my life it
391. 14:14was the worst trauma i think i probably
392. 14:16still have some ptsd from going through
393. 14:19that
394. 14:20it is very much a trauma and so many
395. 14:23people suffered and just you know
396. 14:26watching all that
397. 14:27suffering you know people losing their
398. 14:29jobs and their retirement and
399. 14:32um
400. 14:32so
401. 14:33i would say that i grew
402. 14:36a tremendous amount through that
403. 14:38experience and and also through the the
404. 14:41last 20 years and i've been you know
405. 14:43sharing the story
406. 14:45uh
407. 14:46you know since it happened
408. 14:48that i uh when you go through something
409. 14:50like that it makes you really stop and
410. 14:52think about your priorities so
411. 14:54what matters most in life
412. 14:57what's you know what are your values
413. 15:01how do i want to spend my time
414. 15:04and those are some of the things that i
415. 15:07began to to grapple with also identity
416. 15:10i really struggled with identity for a
417. 15:12period of time because i had you know
418. 15:15obtained my degree and graduate degree i
419. 15:17mean i had my career planned out
420. 15:20and i think what what i know
421. 15:23is that and i think this is an important
422. 15:25point especially for young people is
423. 15:27that you're not your career
424. 15:30you're not your career it's just
425. 15:32something you do
426. 15:33and you're not what other people think
427. 15:35or say about you that you have inherent
428. 15:38value and
429. 15:41that i still have the same strengths and
430. 15:43skills and talents that i had before
431. 15:45i'm just using them
432. 15:47in a different way
433. 15:49that
434. 15:50living a life of meaning
435. 15:53was the most important thing
436. 15:55to me more than success
437. 15:57right and so it really changed how i
438. 16:00um
439. 16:01looked at life and i think that i
440. 16:04also am
441. 16:06much more i think i'm more compassionate
442. 16:08more empathetic with other people um
443. 16:12and i encourage people to put themselves
444. 16:14in the shoes of as you know when i speak
445. 16:17of other people the people who committed
446. 16:18fraud or
447. 16:20shareholders employees who lost their
448. 16:22jobs and or internal or external audit
449. 16:24and really think about what decisions
450. 16:26they might have made and and how these
451. 16:28events would have impacted them because
452. 16:31we all face these ethical dilemmas and
453. 16:34so i want it to to be real to people i
454. 16:36want people to be able to personalize it
455. 16:39and take lessons back
456. 16:41um that they can apply in their personal
457. 16:42life as well as in their career right
458. 16:45you know i i recall reading as i read
459. 16:47your book
460. 16:48i felt there were several times that i
461. 16:51felt that you
462. 16:52you had real empathy for some of the the
463. 16:55underlings who had gotten caught up in
464. 16:57this people who
465. 16:58were just sort of following direction
466. 17:01um and and i felt that empathy coming
467. 17:04from you because i think so often
468. 17:07as auditors we see everything in black
469. 17:09and white and we don't ever stop to put
470. 17:11ourselves in someone else's shoes and
471. 17:13say i can almost see how they get caught
472. 17:16up in that doesn't mean
473. 17:17it's not sympathy and we don't excuse it
474. 17:19and we don't
475. 17:21you know wipe it under or sweep it under
476. 17:23the rug but that empathy helps us i
477. 17:26think to understand
478. 17:28the circumstances people found
479. 17:29themselves in i think so too i think it
480. 17:31helps us to understand what the drivers
481. 17:33are the temptations
482. 17:34um and and to be better auditors really
483. 17:38um
484. 17:39i don't think
485. 17:40that
486. 17:41in in the case of worldcom
487. 17:43the mid-level managers who were
488. 17:44complicit were bad people i think they
489. 17:46were
490. 17:47pretty average citizens
491. 17:49and i remember giving a presentation a
492. 17:52number of years ago with the lead
493. 17:54prosecutor who prosecuted
494. 17:56bernie ebers the ceo and he said
495. 17:59i'll take it a step further he said i
496. 18:01don't think anyone
497. 18:02in this particular case all the way up
498. 18:04to the ceo level was quote a bad person
499. 18:07but you don't have to be a bad person to
500. 18:08make terrible decisions that can end up
501. 18:11ruining your life in the lives of other
502. 18:13people
503. 18:14and i think that's why it's so important
504. 18:16that we
505. 18:18talk about these cases that we reflect
506. 18:20back on them
507. 18:22um and and think try to put ourselves in
508. 18:24the shoes of other people so that when
509. 18:26we find ourselves at some crossroads
510. 18:28we'll be more likely to
511. 18:30you know think it through
512. 18:32find our courage and make the right
513. 18:34choices
514. 18:36[Music]
515. 18:45you