HP Execs Apologize, Explain to Congress
By Colleen Taylor -- EDN, September 28, 2006
Current Hewlett-Packard Co. CEO and Chairman Mark Hurd testified along with recently ousted former chairman Patricia Dunn today before a congressional panel investigating the company's corporate spying incident.
Hurd and Dunn elucidated the details of the incident, in which HP-appointed investigators allegedly used illegal tactics to obtain phone records of board members, as well as journalists. HP appointed the investigators in an attempt to find out who on the company's board was responsible for leaks to the press that dated back to 2005. The execs' scripted testimonies were released earlier this week by the U.S. government's House Energy and Commerce Committee, which is probing the case.
In separate statements, both Hurd and Dunn offered explanations regarding the situation, claiming that the spying began with good intentions but eventually spun out of control.
"What began as a proper and serious inquiry of leaks to the press of sensitive information from within the HP board became a rogue investigation that violated HP's own principles and values," Hurd said in his 12-page long statement. "How did such an abuse of privacy occur in a company renowned for its commitment to privacy? The end came to justify the means."
For her part, Dunn, who has come under fire for overseeing and ordering the spying, apologized in a 33-page long testimony, yet offered a staunch defense of her actions to find the source of the leaks.
"While I wish fervently that none of this had ever happened, had undisciplined communication with the press continued and a major violation of securities regulation ensued, [I] would have been justifiably criticized by the board and beyond for not having taken their concerns seriously enough," Dunn said in her statement.
Dunn, the maligned cover girl of a bevy of business magazines of late, added that much of the media's criticism of her actions "reflects profound ignorance of board functioning and fiduciary responsibility."
Dunn went on to urge Congress to consider legislation that would provide clear-cut rules on pretexting and give companies like HP "legitimate and sanctioned ways of pursuing their responsibilities to protect their intellectual property and confidentiality." Dunn claimed that this series of events would not have occurred had there been a law enforcement agency that she could have used to investigate the leaks.
Looking ahead, Hurd, who took the helm as chairman of HP's board after Dunn's resignation, concluded his testimony by pledging to work to restore the company's sullied name.
"I pledge that HP will take whatever steps necessary to make sure nothing like this ever happens again," Hurd testified in his statement. "This company will regain not just its reputation as a model citizen with the highest ethical standards—we will regain our pride."
