Too many MBAs. Too few controls. Too much pressure from Wall Street. These are just some of the theories bandied about to explain why the CFO was at the scene of so many corporate crimes. Even as the Enron/WorldCom/Tyco trials bring back memories of the dismal winter of 2001, the newspapers bring word of brand-new scandals in which the CFO played a key role. The case of Royal Dutch/Shell, whose overstated reserves were apparently well known to CFO Judy Boynton, raises yet again the question: What were they thinking? (See "DÉjÀ Judy.")
CFO magazine has long argued that the finance chief plays a larger role in corporations than has been generally understood. But the current focus on the CFO as "chief fraud officer" is not what anyone envisioned. My theory is: Sometimes, when operations can't deliver an expected result, the CFO is asked to help produce that result like a relief pitcher called in to pull his team out of a jam. All too often, that has involved financial manipulation.
Theories aside, by now it's clear that corporate fraud is a global problem. We'll be dealing with it for a long while. And when investigators suspect wrongdoing, they will cherchez the CFO.
For the time being, finance executives—most of whom, it bears repeating, are highly ethical—are caught between a rock and a hard place. They are working under a cloud of public suspicion even as they implement the regulations imposed to allay that suspicion and grapple with the pressures that led to abuses in the first place.
Major League Baseball is a business currently beset by suspicions of a different sort. The CFOs of baseball ("Squeeze Play") are charged with imposing sound financial management on organizations whose shareholders and stakeholders—owners, players, and fans—want to spend as much money as possible.
It's a Herculean task. Let's hope none of them are on steroids.