Warning: A non-numeric value encountered in /homepages/42/d616108096/htdocs/elisaturullols/wp-content/themes/Divi/functions.php on line 5763

Another corporate scandal in the news

Another corporate scandal hits the news

And another corporate scandal hits the news. This time BT. For many years, top executives in the Italian subsidiary engaged in false accounting and embezzlement. The reasons? Still unknown, but their seven figures bonuses may have been one of them.

Where was the internal audit department? And the compliance one?


What about the external auditors? How come that for many years nobody saw anything? Now the scandal and numbers are so huge that they wiped £8bn off in market value for the great joy of the shareholders and investors*. Is it the only scandal? Or is it just the peak of the iceberg that shows loose controls and a weak internal control framework? This will bring us back to the questions above.

I cannot understand that nobody saw anything for such a long time, unless there is gross incompetence or silence (either through threats or financially motivated).

Surely BT has a speak-up policy. Most likely too it has a speak-up line managed by a third party. This way it guarantees anonymity so people can raise issues easily. Clearly this time none of this worked. It is also worth reviewing whether this speak-up policy is just a window dressing solution to comply with legislation or good practices but without any intention of ensuring effectiveness. How do BT employees perceive this policy? Do they feel they can raise any issues without being penalised? There are surveys that have revealed the lack of reliability employees place in the speak-up policies and processes. The perception is that nothing will be done and the one blowing the whistle will be penalised. It clearly shows lack of trust in the hierarchy. This lack of trust has proven to be very real at BT.

My experience with scandal

As internal auditor, compliance and external auditor, I have always spotted the wrongdoings and bad practices before they hit publicly the news. People have always felt, and still feel, they can speak up to me and raise any issue. They know they will be safe. Sometimes it was me who suffered the aired reaction of some top executives that were not happy with my findings, but this is what shows the competence and maturity of an internal auditor (or compliance or external auditor) professional.

This way the company can easily address any problem, avoiding scandals and, very importantly, avoiding significant financial costs.

This is peace of mind for shareholders and investors.


Those top executives involved in wrongdoings and bad practices should be punished. They should not work at their level until they prove they have changed their behaviour. So many years lying and hiding the truth is not a punctual situation or problem. It is an attitude, one that no company can afford to. A robust corporate governance and professionalism could have avoided this scandal.

Elisa Turullols (www.elisaturullols.com)

*For the avoidance of doubt the tone of this sentence is ironic.


This site uses cookies for you to have the best user experience. If you continue to browse you are consenting to the acceptance of our cookie policy, Click on the link for more information.

Aviso de cookies