The Corporate Ladder

"I have a favor to ask; I think we both know that until this deal is done---sooner rather than later---we need to play it very cool. No one is going to bat an eyelash about one day trip together but, much to my regret, it's not something we can make a habit of."

"And?"

"After this deal is done...we've taken him down or failed...whatever! Is there a chance that you'd say yes if I asked you to dinner---no work, no expense accounts...a real date?"

Now it was Melissa's turn to get fuzzy; it was literally the first time she had ever looked at Joel and thought about the future...their future? He was one of the good guys...their ages were close...good genes...kind eyes...maybe?

"I'd like that," she said, briefly placing her hand on his. "But you're right. We need to play it close to the vest until whatever is going to happen happens."

They exchanged their second hug when she dropped him off at home; they added a peck on the cheek...and then she was gone.

The following day Brett and most of the entourage were off on a retreat which was nothing more than another company paid golf outing and drinking party. A legitimate crisis came up in one of the plants; it probably could have been handled on the phone. Joel had learned enough about Brett to know how much he feared a major disaster in his area of responsibility which might bubble up the chain. He convinced his boss that he needed to get to the bottom of it and if he got it fixed early he'd join the group later. Davidson didn't fight it.

In effect, he'd put the fire out well before lunch. He was completely unprepared when the COO stuck his head in the door and asked if he had a minute to chat.

"Sir, I actually do! I thought I was going to be wrestling with this thing in Alabama for the rest of the day but it looks like the crisis was averted so I can goof off---until the next one."

"Call me Andy, Joel. I want to hear about your military experience and swap some war stories but I bet you didn't know my first job in this company was at the plant you just closed."

"I'll be damn!"

"It was a while back; it was a vibrant little town back in those days. The weather still sucked but I had fun there. It always pained me to watch its decline....even from afar."

The two men of different generations quickly formed a bond thanks to a shared military heritage.

"Do you hear anything from Simon, Joel? I hired him, you know...green as hell and right out of college. Salt of the earth. I'd like you to know that I had nothing to do with what was done; I tried to fight it---both times. I may be the COO but it's more because I control a sizable block of voting stock and thus a director or two. I'm one of the last guys around who ever actually ran a plant. Don't let my title fool you; I'm not in the inner circle---less so as the years go on. Frankly I'm getting tired of it; maybe it's time to retire. I was hired by the founder...long dead now...different company...." His voice trailed off.

Joel's mind was racing. "I have heard from Simon; he's living in Dayton as I recall. He was the best boss I've ever had. I'm very fond of him."

"He'll land on his feet. He always has."

"Not to pry, sir...Andy...but... and forgive me if I'm out of line... you started in plants, you worked your way up through manufacturing...as I recall the CEO has no such background...I know I'm naïve when it come to the lofty levels of a corporation---but why aren't you running this company?"

"Politics, institutional investors, I was always a little too open, honest and direct, never glib. Told 'em the truth, not what I knew they wanted to hear. Too old school...take your pick! Look, son, I've got nothing left to lose---you do so don't hang your hat on me---I don't like the direction this company is going in. I'm not even sure I'm comfortable with the results we are reporting. Bluntly I spent enough time on a shop floor to know that the productivity numbers are flakey...maybe worse."

Joel dipped his toe in the water. "Doesn't my department report those results---Brett's, I mean? But they roll up...don't they? Are you saying some number of plant managers are massaging the numbers?"

"You are the director of Plant Ops East---do you see those numbers?"

"No, now that I think about it---I don't. They go directly to Brett Davidson, but hell I know enough about how they are calculated to reconstruct them. I mean I'm not privy to the final report---but I am to all the pieces that make up that final report. It would take some time but...it wouldn't be that hard."

The COO removed a card from his vest pocket and handed it to Joel. "Let me save you some time. Check your reconstructed numbers against the official reported numbers for last quarter for just the locations in this region. Then drop by my office for a chat. Better still, no one is surprised to see me wandering around the building. I eat my lunch in the company cafeteria. Maybe we can share a burger together...tell old war stories."

By the time everyone had gone home, Joel had reconstructed the figures from the little pieces for the locations in question. Sindi had provided him with the official reported numbers that went up the chain but did not have access to the summary reports sent up by the individual plants. Those numbers went directly from the plant managers to Brett Davidson.

Why didn't the location managers ever say something---were they in on it? Probably not; they only knew what they reported to Brett, who then consolidated the numbers by regions---and he decided what a region was; there were no region managers---and reported then up. Why hadn't the outside accountants figured it out? They looked at money rather than productivity; productivity was what made the current investors happy. He needed to talk to a lawyer versed in corporate law to determine if fudging productivity numbers violated SEC rules. It had to—didn't it? In this industry, productivity directly influenced stock price. He didn't need a forensic accountant to tell him the productivity numbers were being cooked. He called Melissa.

"Have you got a sec? I'd come down there but I've got spreadsheets everywhere."

Her pretty head was peeking around his door in a under a minute. "What do you need?"

He gave her an quick overview of what he had been working on; then he handed her a list of names. "Have these plant managers ever worked for Davidson?"

"Sure---all of them have been part of the entourage at one time or another. What have you got?"

"I don't know; maybe nothing. I need to talk to Simon."

"I'll let you get back to work."

"Thanks."

Joel left the building a few minutes later with all the data he had reconstructed on a flash drive in his pocket. He called Simon as soon as he got home.

"Good for you, Joel! I figured you'd find it eventually; It has been going on for some time. Now let me give you the bad news. Productivity is subject to interpretation; different industries and even companies within an industry use different formulas. Unless you can prove a conspiracy to cook the books for the sole purpose of manipulating the stock price possibly in cahoots with a large investor---you don't have much. I found it; Davidson found out I'd been sniffing around through one of the plant managers.

"The forensic accountant called; another good news-bad new story. While there were certainly numerous questionable---even blatant---abuses it would have to rise to the level of tax fraud to amount to anything. Even if there were tax implications the government knows how hard it is to prove conspiracy or fraud and in any event, it's small potatoes in the far bigger picture of corporate tax revenues.

"One would hope that the outside accountants occasionally audit some expense reports and report a pattern of abuse to the top brass---but it's up to them to do anything about it. This is not the only company that lets it ride as an unwritten perk."

"So, Simon, we're nowhere?"

"Accept the fact that top brass ---at least the CEO--- thinks Brett walks on water; they either know damn well he's doing some funny things and allow it for whatever reason or they are oblivious because they've been buffaloed by his charm. Sure, if you could get to a few key members of the board---enough to vote a majority of the stock---they could do something. No board member is going shake the trees over expense abuse by an underling; it would be a major breach of protocol. No board member is going to question the CEO's competence over a few funny productivity numbers. What you have is barely the tip of the iceberg in terms of what it would take to bring anyone down."

The next day in the cafeteria the COO did in fact share a table with Joel. Joel shared with him his frustrations.

"Joel, sadly you are right on target; even in combination with the expense report issues---which I used to complain about to no avail---it's not enough. On the other hand, don't completely discount what you have. It's the old straw that broke the camel's back. Keep piling on the straw. I've got to believe that the day will come when the pile gets big enough that someone says---'enough'."

Later in the day Joel brought Melissa up to speed. "Melissa, what about the whole sexual harassment track?"

"Joel, I've got volumes---of 'he said-she said' stuff. He targets exempt employees so the feds don't really care. We've paid a number of them off---money talks---and the 'problem' goes away. Who knows how many just quit or, worse, put up with it? If senior management really examined my data they would see a disturbing pattern---not every woman could be lying. They'd have to do something---at least call him in and tell him to knock it off. I am not in a position to drop it on the CEO's desk---my boss tried, got burned and wimped out. You might as well add my files to your data base; I'll drop a DVD off later in the day."

Over the next few months Joel continued to play his role and dig up more straw. Misuse of company provided vehicles seemed to be a standard practice. Demanding that employees perform personal services for executives---to include the CEO---seemed to be accepted and routine.

Did Brett Davidson use company funds to purchase the services of nude dancers and female escorts to reward loyal members of his team? Routinely. Mike had broken down credit card receipts and discretely observed and recorded the events. On at least one occasion the CEO had joined Brett's little cabal at a private "gentleman's" club. He had also found evidence that corporate credit cards had been used to buy lines of credit at casinos. As pathetic as it all was, it wasn't enough and they all knew it.

One day, a predictable event occurred which none of them believed would amount to anything. Not for the first time, Brett Davidson had sexually assaulted an employee at an off-site conference. While the young lady in question had escaped with her virtue intact, it had been a harrowing experience for her. He'd done it in a public venue with witnesses; sadly almost all of the witnesses were part of Davidson's entourage and would lie to protect their boss. Mike Bowman had engaged an old LE friend who had not only witnessed it but taken brief statements from a waitress and a bartender---neither of whom wanted to get involved or were willing to "testify".

The young lady in question was an intern just off the college campus; she reported the incident to Human Resources---to Melissa. Melissa pledged to investigate after candidly informing the cute little blond of the 'he said-she said' issues and the likelihood that the entourage would clam up, circle the wagons and get their stories straight. Based on her previous experiences, Melissa took a low key approach indicating to Brett that the young lady had filed a formal complaint which required a response from Brett and whoever else was present. He'd already prepared it as had his boys. Their accounts of the incident were essentially word for word copies of each other.

Brett Davidson's arrogance had reached new heights. He ordered Melissa to handle it---fire her, transfer her or buy her off---but be damn sure he didn't hear another word about the incident. Melissa had kept Joel in the loop; as with every other tidbit, he logged it into his growing data base. At the cafeteria salad bar the next day, he mentioned to the COO that Davidson had assaulted another female.

"Who? Do I know her? What's her name?" Joel told him. The old man smiled knowingly and left the cafeteria without finishing his salad construction.

The young woman had told two people about the incident; first, she had told her father. He had told her to follow procedures and speak to HR. The second person she had told had been Melissa. Following Melissa's frank discussion with her, she had gone back to her father and brought him up to speed. He had been furious but what could he do?

As Joel was walking to the elevator late on Friday the COO called to him to hold it for him. As was typical, the two of them were essentially the only ones left in the building.

"Joel...do you have big plans for tomorrow?"

"Mow the lawn in the morning and watch the football game in the afternoon?"

"Mind if I stop by around noon? I'll bring the beer."

"I'd be honored."

"Mind if I bring an old friend? You don't know him but he's anxious to meet you."

"The more the merrier!"

Joel had finished his yard work, straightened up the house, checked the picture on his new HD TV and thrown together some lunch snacks well before the old COO arrived. It was actually the first time he'd ever really seen the old gent in casual duds. The gentleman with him was a few years younger but his demeanor said he was a denizen of the top floor in some corporation.

The COO introduced his friend. "Joel, I'd like you to meet a very dear old friend; this is Mike Cavanaugh. He's a member of our board of directors and the CEO of one of our largest suppliers of raw materials. He has a daughter---my Goddaughter actually. Her name is Katie."

You could have knocked Joel over with a feather; Katie Cavannaugh was Brett Davidson's latest victim.

"Pleased to meet you, Joel; Andy tells me you have been constructing a rather interesting data base for the last few months. I was hoping you would share it with me."

Wordlessly Joel put Mike Cavanaugh in front of his computer and pulled up the database. Over the months, Joel had organized everything with a summary timeline at the beginning with each entry linked to the supporting documentation. Mike began to peruse the data as Andy looked over his shoulder.

"Beer?" Both of the older men nodded. Joel got them two beers and a plate of snacks. An hour later, Mike Cavanaugh sat back in his chair with a grim expression. The expression morphed into a grim smile.

"How do I get a copy of this? All of it...including the supporting documentation."

"I can burn it to DVDs---it's just going to take time...probably a couple of hours; there's a lot of data."

"Let's do it."

It would in fact take six DVDs to download all of the data. Even with a new high speed DVD writer in would take as long as three hours. Joel informed his guests.

"I don't want to leave here without it; please print off the opening summary. When does the game start?"

"Thirty minutes."

"Mind if we invite ourselves to stay and watch it on your new TV?"

"Not at all! Are you telling me you can do something with it?"

"Can and will, Joel. I'm one of five outside directors on your company's board. I control a voting block of right around thirty-six percent. I am quite confident that I can corral at least two of the other outside directors---maybe three. That doesn't give us a majority of the board---but it will give us over fifty percent of the voting shares. That's enough for a proxy fight. If one inside director goes along with us, we can in essence 'recall' the CEO, the inside directors and the registered officers of the corporation without going to the time and expense of a full blown vote by the shareholders. That one inside director is sitting next to me."

Andy spoke up. "We might do better than that; I have a hunch the CFO will go along---he's getting very nervous. HR is spineless---but he'll jump in if he senses we are going to win. That's a majority of the board---not to mention the outstanding shares. It'll be over before they know what hit them."

"Gentlemen, I'm a babe in the woods when it comes to corporate---board of directors---stuff. What are you going to do, exactly?"

"Share every bit of this with the other outside directors whom I trust. The next scheduled board meeting is this coming Wednesday. Under this corporation's charter, if an outside director moves to recall the board and senior management, it has to be seconded by an inside director---Andy. We vote; if we lose on the simple majority a second motion is entered to call for a proxy vote.

"Even if we win on the simple majority, the other side can demand a proxy vote which would get messy but we would have the voting shares to prevail. If they try that, I'm going to hand a copy of your summary document to everyone in the room. It's damning enough taken in its entirety that no one is going to want it to go public; it would hurt the corporation and every man in that room owns stock...lots of stock. I would expect that a few fence sitters---rats leaving a sinking ship---will come over to our side. If we can get a two-thirds majority---it's over. All inside directors---the senior management team in essence---resigns. The outside directors briefly take over the corporation and appoint a new board and new officers. Ultimately it has to go to a public vote by the shareholders but we'll win that one hands down. It's little more than a legal formality."

"Sir, I've been going down dead end streets for too long; every time I thought we had something it turned into nothing. How confident are you?"

"Call me Mike, Joel. We are not talking about a court of law here---and I am a lawyer. We're talking about a board room. No board of directors wants to allow this depth and breadth of... for sake of a better term...'questionable management practices' to end up in the public eye. CEOs have been toppled with far less documentation. I might get surprised---but I highly doubt it. You've done all the work; I'll let you know Tuesday evening or first thing Wednesday morning where we stand. Andy alluded to the team you've assembled; as much as I'm sure you want to tell them, hold off until the door closes on the board room Wednesday at nine AM at the earliest. I will not kick this off unless I'm 100% certain of the outcome. Fair enough?"

A little over three hours later, The Ohio State University had come from behind to win a close one and the DVDs were in Mike's hands. Mike wanted to tell someone---certainly Melissa. She called after the game; she was depressed and at her wits end. She was ready to throw in the towel.

"Melissa, I don't want to—can't say anymore. I don't want to get your hopes up or anyone else's in view of all the dead ends we've experienced. All I can say is, I believe it's finally come to a head. We'll know one way or the other by the end of the week. If it's not resolved to our satisfaction, I'm with you. I need to move on, career wise."

She accepted his answer. Monday and Tuesday Joel buried himself in work to keep from thinking about the upcoming board meeting. Brett stopped by to introduce his latest unqualified young female employee; he'd already had his hand on her butt. Joel did not hear anything on Tuesday. He was just getting ready to leave for the office when his home phone rang.

"Joel? Mike Cavanaugh. It's a done deal---better than I had expected. It will all be over before lunch."

Joel called Simon hoping he hadn't left for work at his new job. "Simon! I don't have time for details but they're going down---today---guaranteed. I'll fill you in after lunch."