When a Woman Blows the Whistle
Sherron Watkins, Enron vice president of corporate development, wrote a letter in August to Enron CEO Kenneth Lay warning that the company could collapse under the weight of accounting and ethical improprieties. Four months later, it did. The company now faces criminal and regulatory investigation.
With her now-famous letter warning precisely how Enron Corp. could collapse, written four months before it did, Enron Vice President Sherron Watkins joins the ranks of people who have seen wrongdoing and blown a whistle on it.
Some other prominent whistle-blowers have been women. Perhaps the best known is Karen Silkwood. A lab analyst at a Kerr-McGee plutonium fuel rod plant in Oklahoma, Silkwood accused the company of unsafe practices. She was killed in a suspicious car accident in 1974, and became a heroine to labor, feminist and environmental groups, and the subject of a movie.
Tammy Raynor was the central whistle-blower in a licenses-for-bribes scandal in Illinois. A former driver’s license examiner, Raynor brought to light corruption in the secretary of state’s office. Since 1998, 40 people have been convicted of wrongdoing.
There is no correlation between taking this kind of stand and gender, said Stephen Kohn, board chairman of the National Whistleblower Center, a nonprofit advocacy organization that assists whistle-blowers and one of the nation’s leading legal experts on whistle-blowing. “What motivates a whistle-blower is gender-neutral,” he said.
Indeed, it is more common for a whistle-blower to be a man, said Lynne Bernabei, a Washington lawyer whose firm specializes in representing whistle-blowers nationwide. Women, she said, are less likely to reach professional positions high enough to be privy to the kind of information that could make them whistle-blowers.
“And women are much more cynical about the system,” she said. “The typical whistle-blower is a believer in the system.... Typically, it’s a white man who has been very much in the power structure and who comes up against something he just can’t stomach and believes that if you just bring it to the proper people, it will be taken care of. Then they get fired.”
Watkins was not fired from Enron; she remains vice president of corporate development at the energy-trading firm. After the licenses-for-bribes scandal broke, Raynor was appointed an investigator with the secretary of state’s inspector general’s office, with responsibility for evaluating commercial driver’s license facilities throughout the state and reporting any corruption.
Gender differences often arise, however, in how a female whistle-blower is treated, Kohn said. “You’re going to face retaliation, some form of professional or personal insult,” whether you are a male or female, he said. “But if you’re a female, there’s a strong chance they will look at your appearance and your sex life, and use that as a basis to insult you or issue derogatory statements. That will not happen with a male.”
That’s what happened to Linda Tripp, he said, the former Pentagon assistant who secretly tape-recorded the confidences of her friend Monica Lewinsky. Many people revile Tripp as a snoop and betrayer, he said, but he considers her a whistle-blower, and an extremely effective one.
“Linda Tripp [brought about] an impeachment of a president, a finding that a sitting president was in contempt of court, a suspension of a president’s license to practice law,” he said.
Watkins’ lawyer has hesitated to call her a whistle-blower, saying that her actions could be seen as whistle-blowing or just doing her job responsibly.
Watkins wrote a seven-page letter detailing practices that she warned could make Enron “implode in a wave of accounting scandals,” and offering advice on how to resolve the situation.
She sent the letter to Enron Chief Executive Officer Kenneth Lay, anonymously at first and then acknowledging it as hers. Lay met with her and a Houston law firm conducted a review, but the lawyers decided that her allegations did not warrant further investigation. Six weeks later, Enron filed for bankruptcy. The company now faces criminal and regulatory investigation, and its practices are being examined by six congressional committees.
She never made the letter public. It was found by congressional investigators going through Enron documents, and released by the chairman of the House Energy and Commerce Committee.
Watkins’ actions parallel those of other whistle-blowers, Kohn said. “The fact that she went to the CEO is typical,” he said. “She’s not disloyal; she wants to help the company. By taking it to someone in the company, it’s a way of satisfying both your moral sense of right and wrong, and your loyalty to the company.”
Whistle-blowers generally fit two categories, Kohn said. “The first is those who do it for a moral reason. They know something is wrong and they can’t live with themselves unless they do something about it,” he said.
“The second is the unintended whistle-blower, who raises concerns like a normal person would raise them, but because of the dysfunction within the institution they raise concerns about, they get retaliated against. And what often happens is, the two categories get merged.”
Whistle-blowers tend to have an independent moral structure, he said, that makes them question superiors’ assurances that the company’s actions are correct.
How is Watkins’ role likely to be judged? Kohn said it depends on who is doing the judging and how they feel about the practices she exposed. For example, the general public regards tobacco industry whistle-blowers as courageous, he said, but tobacco company employees consider them disloyal.
Bernabei warned that even when whistle-blowers turn out to be prescient in their warnings, they are rarely rewarded by their institutions. “The reality is, nobody wants to say, ‘You told us so; you should be in a better position because you had wiser vision,’” she said.
But Charles Elson, director of the Center for Corporate Governance at the University of Delaware, thinks that is exactly how Watkins will be perceived. “She had the courage to come forward. She kind of called it; that took a lot of guts. I would say someone like that comes out a heroine, not a snitch.”
