Sherron Watkins landed on the cover of Time magazine, got up close and personal with a bunch of U.S.
Congressmen, and was lauded by Barbara Walters as one of the 10 Most Fascinating People of 2002.
On the other hand she lost not just a dream job, and most of her retirement savings along with it, but
ultimately an entire career.
The "whistleblower of Enron" gave the keynote address for the Bowling Green State University
College of Business’ Women in Leadership conference Thursday. This year’s theme: "Women and Ethics
in the Workplace."
The collapse of Houston-based energy and commodities giant Enron was a corporate swindle of a magnitude
almost defying belief.
Prior to joining Enron, Watkins, who had a B.S. in Accounting, worked in New York City, part of the time
for accounting giant Arthur Andersen.
Initially, she was ecstatic about her move to Enron.
"I wanted to move back to Texas, where I was from. I had former Andersen co-workers there. It was
‘the’ place to be," the nation’s seventh largest corporation.
Even better, Enron was experiencing stratospheric stock growth each year, "and they were putting
half of our 401-K in Enron stock. So every time you opened it, it looked phenomenal."
In retrospect, she says, Enron had "a very unhealthy focus on our stock price. It’s what (COO, and
later CEO) Jeff Skilling always talked about.
She points to Steve Jobs for contrast. "You really want a CEO who’s excited about the product and
the services. You never heard Jobs talk about the stock price."
Many upper level employees got used to receiving annual bonus checks greater than their annual base pay.

"That’s heady stuff, and it was happening to 15 to 20 percent of the people at Enron. It bought some
pretty good blinders," said Watkins.
What the company’s 20,000 or so employees didn’t know was that Enron was careening toward a cliff – even
as "top leadership had sold $1 billion in (company) stock in the last two years before Enron went
bankrupt."
Although a couple dozen Enron executives were eventually handed criminal convictions, there are just two
who Watkins calls "criminals": Skilling and chief financial officer Andy Fastow. Just months
after being named CEO, in 2001, Skilling abruptly resigned from the company and cashed out nearly $60
million in stock.
Two weeks before Skilling quit "I found the fraud," Watkins said. She had stumbled across
accounting irregularities.
Her plan was to put together evidence of the fraud, report it privately to company founder Ken Lay, and
immediately leave the company.
Skilling’s sudden departure messed that up.
"I was too rushed. The day after Jeff Skilling resigned I had a dozen people helping me"
collect data to prove the irregularities and Watkins says she should have brought some of those people
along with her to meet with Lay, plus someone above her in the corporate ladder.
"My biggest mistake: I went in by myself where he could dismiss me as a single voice."
"I thought (Lay) was a different person" than he turned out to be. "I thought he would
listen to me. I just wanted him to hire an outside law firm to look at this."
Instead of taking steps to "make it right," Watkins found out later that Lay’s immediate
response to her Aug. 15, 2001 memo to him was to get confidential advice about whether he could safely
fire her.
"I’m sure they looked through eight years of my expense reports to see if they could fire me for
cause," she added, warning to her audience to always be scrupulously honest about such paperwork.

The company filed for Chapter 11 that December, laying off 4,000 people "with no warning, no
severance, and three weeks before Christmas," Watkins recalls. Many more were laid off in January.

Enron shares worth $90.75 at their peak in August 2000, had dropped to $0.67 in January 2002.
Why did Watkins and others go along with the status quo for so long?
"You would end up getting a push-back that was very intimidating," Watkins said of her earlier
attempts to bring matters to Skilling’s attention.
Whenever Watkins found herself "trying to understand" something Enron was doing that didn’t gel
with established accounting practices, Skilling or Fastow’s response was that if you couldn’t see the
brilliance of doing it Enron’s way "you’re either stupid or not doing your job right."
"You can’t speak truth to power from even the second rung if the first rung is corrupt,"
Watkins warns business students.
What she didn’t realize at the time was that "there’s really nobody with the label of whistleblower
that works in their normal career again." That was something another whistleblower told Watkins
after the Enron trials. She was shocked, but now admits it’s probably true.
Potential employers may think to themselves: "Can’t we find someone with the same skill set who
comes with less baggage?"
"The Fraud Triangle," she said, has three components: Financial pressure, the opportunity to
cheat, and "the rationalization that what you’re doing isn’t actually illegal."
"I’ve got so many baby gifts, wedding gifts from felons in my house," she said to loud laughter
from the BGSU audience.
Based on her experiences as a woman in corporate America, Watkins recommended that her female business
audience:
• Consider finding themselves a male mentor. Much as we would like to think otherwise, the top levels of
business are still controlled largely by men, and at times women would do well to emulate their more
direct communication style, she argued.
• Find a way to be your own cheerleader.
• If faced with an ethical dilemma in the workplace, "listen to the still, small voice inside you
that is warning you. If it’s something you wouldn’t want to read on the front page of the newspaper,
don’t do it. If it’s something you wouldn’t want your mother to hear about, don’t do it."