Business Ethics and Governance Issues at HP: The Pretexting Controversy |
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"I'm sad for the company and shocked at the things that appear to have been done. My third reaction is that it lifts the veil on the dysfunction that existed in the boardroom at the end of my tenure." 1 - Carly Fiorina, Former Chairperson and CEO, Hewlett Packard, in 2006. "Fortunately, Hewlett-Packard is not Enron, I commend the firm for cooperating instead of stonewalling, for taking instead of shirking responsibility, and for working with my office to expeditiously craft a creative resolution." 2 - Bill Lockyer, Attorney General, California, in 2006. "HP, which has built a reputation as an exemplar of ethical corporate behavior, may now find itself lumped with other rogue companies." 3 - Representative Tammy Baldwin,4 Congressional District #2 of Wisconsin, in 2006. HP Settles Civil Lawsuit
The settlement included an injunction and agreement according to which the Attorney General would not pursue any civil claims against HP, its directors, and employees. HP also agreed to strengthen its corporate governance practices to ensure compliance with legal and ethical standards (Refer to Table I for the reforms HP agreed to undertake). The trouble began in January 2005 when confidential matters discussed at HP's board meetings found their way into newspapers. The information, which was widely reported in the press, pertained to HP's strategic decisions, future plans, negotiation terms with suppliers, and important business transactions.
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1] Brad Stone, "Fiorina's 'Choices,'" Newsweek, October 16, 2006. |
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