AT LARGE: The truth and nothing but
- 01 November, 2002 14:23
Now I'm disillusioned. A few weeks ago, it was revealed that Kenneth Lonchar, the executive vice president and chief financial officer of Veritas Software, had ever so slightly embellished his CV. He had claimed that he had an MBA from Stanford Business College (one of the most prestigious qualifications an entrepreneur can hold) when in fact he holds an undergraduate degree from Idaho State University. Meaning no disrespect to Idaho State (go the Bengals!) this is a rather less prestigious piece of paper.
Now, I'm sure most of you will agree that this is a very minor indiscretion, and hardly worth noting in the pages of this august publication. Who among us, after all, has never fudged just a smidgen in the name of career advantage? Have you never said you knew how to fix a whatchamajiggit, when in fact all you knew was how to look up the instructions on the Web? Have you never claimed to have management experience, exaggerating slightly your importance as secretary of the cub scout group?
Such fiblets happen all the time, and mostly they're harmless (unlike, for instance, false medical qualifications or pilot licences). In Lonchar's case, he'd served well and competently for years as CFO of Veritas, and there is no suggestion whatsoever that he committed any kind of fraud or embezzlement against the company (in fact, it's possible that - unlike an actual Stanford grad - he doesn't know how). By almost all indications, the company's financial position is relatively sound in the current economic climate.
Like most CV improvements, Lonchar's indiscretion served to open up an opportunity for him to prove his stuff. He rose to a position of prominence on the strength of his performance in various positions, not on the CV that got him through the door in the first place.
Nonetheless, news of Lonchar's revelation and subsequent resignation wiped over a billion dollars off Veritas's market value. As I've said before and I'll say again, the stock market is a measure of whimsy and has nothing to do with reality at all. The problem seems to be that Lonchar was CFO of Veritas, of all companies. If you can't count on the truth from Veritas, what can you count on?
At the end of September it was revealed that Ram Kumar, of Institutional Shareholder Services, one of the key analysts whose advice tipped the balance in favour of the HP/Compaq takeover, does not, in reality, hold a law degree from the University of Southern California. He studied law at USC but didn't actually finish.
Is there now to be a suggestion that his advice may have been flawed? That - hold your breath - the HP/Compaq deal may not have been as good an idea as we all thought?
It's all a load of poppycock, of course. George Lucas finished his degree from USC, and look at Attack of the Clones - it's a mess! I'd be willing to bet Ram Kumar could make a film just as good if not better.
If you want my opinion (and opening up to this page is a tacit indication that you do), such minor cheating in one's early career should not weigh more heavily than subsequent achievements in evaluating the worth of an executive - if they are given any weight at all. And the market's response to Veritas's announcement is ridiculous in the extreme.
Yes, the truth is important. It's one of several principles that people in my profession regard quite highly. But punishing a company like Veritas for revealing such a minor fault is only going to encourage the WorldComs out there, with mammoth skeletons hidden about, to bolt the closet more tightly.
And the subsequent spotlights that have been thrown on executives' educational records are nothing but a distraction from more important investigations into genuine corporate impropriety. It's like being back in first-year Uni when everyone's going about comparing year 12 results, not realising that they were already irrelevant.
Here's a revelation for you: Bill Gates is a college dropout with no qualifications at all! I guess he and his shareholders had better start returning the billions to those of us with degrees, eh?
Matthew JC. Powell, BA (Hons), will accept cheques or cash. No credit cards, please, to firstname.lastname@example.org.