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In a year when bad ethics became synonymous with Big Business, Sherron Watkins of Enron provided a courageous counter example. In 2001, Watkins and a small group of colleagues discovered accounting improprieties in the fast-growing business. Risking her own standing within the company, Watkins sent a detailed memo to then-chairman Kenneth Lay, outlining both the irregularities and recommendations for remedying them. Without prompt action, she cautioned, the firm could "implode in a wave of accounting scandals." (To read the full text of Watkins' e-mail to Lay, click here.)
Watkins also alerted Enron's auditor, Arthur Andersen. Because of her memo, which came to light in January of 2002, it's clear that the management of Enron knew well in advance about the problems the company faced.
Enron's stock did collapse in the largest corporate bankruptcy up to that time, destroying employee retirement accounts, costing more than 4,500 workers their jobs, and becoming a symbol of corporate greed. Watkins' immediate boss-who'd tried to get her fired when he found out that she had contacted Lay-was indicted on 78 counts of corruption.
Watkins recently left Enron to start a consulting business focused on corporate compliance issues. She also plans to give talks about business ethics. In a note to Beliefnet, Watkins wrote, "My Christian faith was/is integral to my actions at Enron as well as my appearances before Congress."
By exposing the worst kind of corporate corruption, Sherron Watkins set an impressive example of individual integrity and courage in the workplace and helped pave the way for much-needed ethical reform in America's corporate culture.
Nomination by Ralph Nader
"People like Sherron Watkins are vaccines against corporate crime epidemics. They are internal accountability checks for large corporations when they speak out on serious violations that result in inflated profits and ultimately looted pension plans and lost jobs. Law enforcement officials, as well as the investing public, should support people like Watkins."
--Ralph Nader, consumer advocate