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Diversity, Equity, and Inclusion Inclusion Matters Inspiration Props

Black History is Our History

That’s My Mom! Photo Credit: James Petrozzello

When I was in about the fourth or fifth grade, I was invited to a Halloween party. There was a costume contest and each of us had to say who we were and give some kind of blurb. Inspired by my mother I went as an official, working for some department (I can’t remember now) and my work had to do with justice and equality. I received the prize for most original costume. At a party full of superheroes, fairies, and movie characters, perhaps a public servant was a truly original costume. Often, though, when I think about it I feel that those parents felt sorry for my quite nerdy self. I don’t regret it – my mother continues to be my shero.

At this intersection of Black History Month and Women’s History Month, I think about how histories, ancient and as modern as just yesterday impact our present and our future. Then I got to thinking about my mother and her sisters and their influences on me, both overt and covert. They figure among the building blocks that make me.

When my grandmother was a young woman in pre-independence Zimbabwe, she traveled to the United States on a trip organized by the YWCA. When she returned home, her telling of her experiences, especially her trip to the Statue of Liberty, inspired her daughter, my mother, to go to the United States for college. I write this casually, like it was an easy thing for my mother but at the time, in her own country, she did not even have the right to vote, and needed permission to get a passport. Somehow, she figured out a way and she started out at the University of Rochester before she transferred to Mount Holyoke. It would be cute if she decided to attend one of the Seven Sisters because she herself was one of seven sisters but I am guessing her decision had more to do with her boyfriend, a fellow Zimbabwean whom she had met at a party in New York City and was getting his master’s in geology, down the road, at the University of Massachusetts in Amherst. After Mount Holyoke, she too went to UMass Amherst and got her master’s in education, and they soon embarked on their next adventure. My parents moved to Zambia where my father worked as a geologist for an American company and my mother taught high school history at the International School of Lusaka. I once came across a yearbook from the International School in one of my mother’s storage trunks. In it, under her photo, her quote was “I am a citizen of the world” and I imagine one reason she felt that way was because she was barely seen as a citizen of her own nation.

After my little sister passed away, in February 2019, I spent several months in Zimbabwe with my mother and her sisters, appreciating anew what phenomenal women they are, and learning more of their histories. After my parents attended university, they decided to pay it forward, each helping a sibling to get to the United States for university. At the time, Zimbabwe was still not independent, and my mother’s younger sister could not get a passport. But she was determined to get out and go to school. At a point in her journey across the border from Zimbabwe into Zambia, she was hidden in the back of a long haul truck, among crates of dried fish and rice. When she finally reached Lusaka and my father went to pick her up she was so frighteningly unrecognizable that my father, fearing the experience might cause a miscarriage, took my aunt to get washed up and changed before my then heavily pregnant mother saw her sister. After my aunt made it to the United States and university, she too paid it forward and brought another sister over for school.

Hearing the histories that my mother and her sisters shared I realized that, as with many marginalized peoples, we often do not hear about their struggles but we reap the benefits of their perseverance. I was with my mother during an impossible time and it was also a time to look at my grandmother’s daughters and see how I what they have done has made me. It was a time to be reminded how they have lived lives where, like the Coles sisters, they follow their desires and won’t be deterred and that is a spirit they have encouraged in their children. It is also a spirit that stands strong for what is right and a spirit that believes in the power of community. When my mother visits us in New York, she loves to take daily walks alone. I have no idea what she gets up to but it must involve a lot of chatting because, long after she leaves the subway station guy or the grocery store employee asks after her. She builds and maintains communities, believing that this is how we all help each other achieve what we seek. And she does do this, starting with the formidable core of her sisters.

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AICPA Diversity, Equity, and Inclusion Inclusion Matters Inspiration NYSSCPA PSA Where We Are

Building Generations

Photo by Jeppe Hove Jensen on Unsplash

When Bernadine Coles Gines, the first Black woman to receive a CPA license in New York, was a kid, she and her little sister, Dr. Ruth Coles Harris, were so into playing office that Bernadine once asked Santa to bring her paper clips for Christmas. So it really is no surprise that Dr. Coles Harris and Ms. Coles Gines, were both valedictorians of their class in elementary school, high school, and college. Following in Bernadine’s steps, Ruth attended Virginia State College, and majored in Business Administration at the undergraduate level. One of the required classes was accounting and it turned out to be her favorite. “I could just stay up all night working.” But it was 1948 and, because there were practically no opportunities for CPAs in the United States at that time, none of the historically black colleges and universities (HBCUs) offered accounting as a major. As I have mentioned, the two year work experience requirement meant most Black people were excluded from the CPA profession.

The head of the business administration department at Virginia State College at the time, Dr. George Singleton, was the fifth Black graduate of New York University’s (NYU) school of business administration. He encouraged both sisters to follow their dreams and work towards becoming CPAs, as impossible as that path appeared at that time. The sisters both moved to New York and attended graduate school at NYU, both majoring in accounting. After graduation, the homesick Ruth moved back to Virginia, to be a professor at Virginia Union, while Bernadine went on to make her historical mark on the New York CPA profession.

Back in Virginia, there were no opportunities for Dr. Coles Harris to become a CPA – accounting firms would not hire her to fulfill the experience requirement, but she did not give up hope. When Ms Coles Gines became a CPA, Dr. Coles Harris was even more motivated – if Bernadine could do it, so could she. In 1962, Dr. Coles Harris decided to take the CPA exam. As a professor she felt that she could not encourage her students to take an exam, one that had low pass rates, that she was unwilling to take herself. On her first try, she passed all but one part of the exam. Five months later, the opportunity to take the outstanding part in Virginia Beach but, because of segregation, there were no hotels in Virginia Beach where she could stay. The thought crossed Dr. Coles Harris’s mind of making a civil rights stance, but she decided to defer that moment and, instead, focus on getting the exam done (you have to pick your battles). She found a hotel in the nearby town of Norfolk. Dr. Ruth Coles Harris passed that exam and, in 1963 became the first Black Woman to receive a CPA license in the State of Virginia, making her own history nine years after her sister.

100 years after the first Black person received his CPA license, there are still very few Black CPAs. Per the AICPA, in 2018, only 2% of CPAs in U.S. CPA firms were Black and only 1% of partners were Black. A recent CalCPA and IMA study noted eight factors that contribute to the lack of diversity in the CPA profession:

  • Lack of exposure to the profession prior to college
  • Stereotypes regarding lower mathematical aptitude
  • A disproportionally higher need to begin earning income immediately after receiving a bachelor’s degree
  • Discrimination experienced by parents or earlier generations from the business community
  • Insufficient support during college
  • Lack of business school professors with whom diverse talent identifies
  • Perceived exclusive environment and inequitable treatment within the profession
  • Lack of visible, successful diverse talent in senior levels of the profession

In the CPA Journal, NASBA’s Alfonso Alexander shared how the CPA profession is a generational one where most CPAs have a family member who is or was a CPA, giving them exposure to the profession. Many people of color do not have anyone in their network who can explain what a CPA is and what opportunities are in the profession. A history of exclusion led to a lack of diversity in the CPA profession and, as a result there are still very few Black families that include a CPA who can expose future generations to the profession. Instead, these future generations may stumble upon the exposure through a teacher or professor, as with the Coles sisters, or once they have started their careers, when they cross paths with a CPA through work.

To address this challenge, in 1980, the National Association of Black Accountants (NABA) launched the Accounting Career Awareness Program (ACAP) to fill the generational role for underrepresented ethnic groups and “increase the understanding of accounting and business career opportunities”. Working with NABA, the New York State Society of CPAs created the Career Opportunities in the Accounting Profession (COAP) program in 1987, to be a part of this vitally important work. I have met CPAs who are products of ACAP or COAP and all of them have told me that they are CPAs because of those programs. We cannot understate that value – even if the ACAP and COAP students do not become CPAs themselves, they can now, armed with a greater understanding of what a CPA is, encourage a friend or family member to consider the profession.

Bernadine Coles Gines and Ruth Coles Harris were both extremely driven and smart women, who each graduated at the top of their class, yet they had to face incredible challenges to attain their CPA licenses. They had a role model in a professor who exposed them to accounting, supported them in college, and encouraged them to strive even though they faced discrimination. As Ruth Coles Harris stated, the exam is difficult enough and, if we want an inclusive profession, we need to address the other factors that are keeping some out.

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AICPA Diversity, Equity, and Inclusion In The News Inclusion Matters Inspiration Props Where We Are

The Past, The Present, The Future

John W. Cromwell

If the way things are had nothing to do with what has come before, history wouldn’t be something taught at school. However, we learn in many arenas that the past plays a big part in shaping the present and the future. Both graphite and diamonds are carbon, nothing but carbon, yet they are very different from each other because of the environment in which they are formed. What happened to the carbon in the past, determines whether is a diamond or graphite today. Is there any story that we can tell that does not involve cause and effect?

On April 17, 1896, the Certified Public Accountant (CPA) designation was established in law in New York. 25 years later, in 1921, John W. Cromwell became the first Black CPA. This year we celebrate the centennial of his achievement and the doors Cromwell opened. When, as a member of the class of 1906, Cromwell graduated from Dartmouth, he was its top science student and then went on to get his masters, also from Dartmouth, in 1907. Despite these achievements, it was 15 years before Cromwell became a CPA, and not through any fault of his.

A native of Washington, D.C., Cromwell had returned home after graduation and discovered that he faced two barriers. First, because he was Black, he was not allowed to sit for the CPA exam in Washington, D.C., Virginia, or Maryland. He also faced a barrier, that would stymie many Black people who wished to become CPAs – the experience requirement. In those states, in order to become a CPA, you were required to work under the supervision of a CPA, something that became the biggest barrier, for Black people, to become a licensed CPA. Even as recently as the 1960’s Bert Mitchell, who was the 100th Black CPA in the United States, struggled to find a job with an accounting firm. Despite graduating at the top of his class, 25 firms would not hire him, using their clients’ attitudes (it could never be their own) toward people of color as an excuse. A window opened for Cromwell in 1921, when New Hampshire instituted CPA laws that did not mandate the experience requirement, and Cromwell took advantage of the opportunity. He traveled to New Hampshire, sat for, and passed the CPA exam in 1921.

Fulfilling the academic requirements of the CPA license is difficult enough – right now, only about half of those who take the CPA exam pass it, and back then an even smaller fraction passed. Now, imagine that you had to wait 15 years, and travel over 500 miles, just to be allowed to even try to suffer through it, despite having graduated from an Ivy League school, at or near the top of your class. Because of their race, the first Black CPAs faced and overcame groundless barriers that had nothing to do with their abilities and everything to do with people’s biases, discriminatory views, and actions.

100 years ago, when Cromwell became a CPA, he became an example of the possible and opened the way for others to follow. Perhaps in 1926, when Cauncey L. Christian took the CPA exam in Kentucky, Christian was braver because Cromwell had shown what was possible. Christian sat for the exam at a time when the exam was not open to Black people. So, in that exam room, Christian had a concern that the other 49 White men taking that exam did not. Although Christian was light skinned enough to pass for white, he must have been fearful of his race being discovered. But, because of his courage, out of the 50 men who took the CPA exam, Christian was one of 7 who passed and, by doing so, became the third Black CPA in the United States. As each Black CPA was licensed, more Black students saw a path to the profession opening up for them as well.

2021 is the Black CPA Centennial and, in commemoration of the trail that John W. Cromwell blazed a century ago, several organizations, including organizing partners the American Institute of CPAs (AICPA), Diverse Organization of Firms, Inc., Illinois CPA Society, National Association of Black Accountants (NABA), and National Society of Black CPAs (NSBCPA) will recognize Black CPAs and push for greater progress. The themes of the centennial are honoring the past, celebrating the progress that has been made, and continuing to build the future.

As we learn about the history of our profession, the pioneers, the challenges, and the triumphs, it should help us better understand its current state. The more we know about the history of exclusion, the better we can understand the lack of diversity and the lack of inclusion of various demographics, especially in leadership positions. We should think harder and question if the status quo exists for any better reason than the environments that existed in the past. We should remember and honor those who, in addition to having to work hard had to find their success, had to navigate around or through the arbitrary biases of others. Most of all, we should look at our present and what we can do now to create an environment that builds a future of belonging, equity, and inclusion in our profession.

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Diversity, Equity, and Inclusion Inclusion Matters Inspiration PSA

History Matters

Photo by jurien huggins on Unsplash

History matters. Looking back at events not only gives us the 20/20 vision of hindsight, we also learn lessons from it. We see the things that change our lives in positive ways, we see the seeds of brilliance and we can build on them, and we see the things we can learn from and try not to do again. The history that we learn, through books, school, and other sources, highlights the history makers and, in insidious ways that we barely notice, creates an image of these history makers. Because humans write history, we should never forget that often what we learn is what those humans choose to record.

In 1891, following the loss of the Civil War, a former congressman of the Confederate States of America, Missouri Senator George Graham Vest, said, “history is written by the victors and framed according to the prejudices and bias existing on their side.” If those victors decide that a history is not worth noting, or if they feel that history does not align with the history they want to tell, they may decide to ignore that history, leave out parts of that history, or just go ahead and assign the history in the way they choose. As a result, some aspects of history have been amplified while others have been muted or erased. The March 27, 1964 edition of Time Magazine noted that the most widely used eighth-grade history text book in the United States mentioned only two Black people by name as having lived since the Civil War. It was this invisibility which led James Baldwin to remark, “When I was going to school, I began to be bugged by the teaching of American history because it seemed that history had been taught without cognizance of my presence.”

The historian, Carter G. Woodson, recognizing the dangerous impact of being left out of the telling of history lamented, “If a race has no history, it has no worthwhile tradition, it become a negligible factor in the thought of the world, and it stands in danger of being exterminated.” In 1926, seeking to correct that and to strive for a more balance history, he launched Negro History Week during the second week in February because it included both Abraham Lincoln and Frederick Douglass’s birthdays. In 1976, the week became the entire month of February, when President Gerald Ford urged Americans to observe Black History Month. President Jimmy Carter officially recognized Black History Month in 1978.

There are people who don’t understand why there is a need to have a Black History Month or, for that matter a Women’s History Month, National Hispanic Heritage Month, Asian American Heritage Month, or any month or other event that highlights a demographic. Shouldn’t it just be history. It should. However, because of who has been getting to decide what history looks like, these historically underrepresented groups have not been given voice. When history happens, it is not automatically recorded in a ledger for all to see. It waits for someone to choose to tell it and we can only hope that person is being as objective and thorough as possible.

In Boston, Massachusetts, in 1716, an enslaved West African man, who was given the name Onesimus by his master, Cotton Mather, told Mather that he knew how to prevent smallpox. Although Mather was skeptical, he verified Onesimus’ story and then spread the world through Massachusetts and elsewhere. Instead of relief at the discovery that could save lives, Mather was vilified for suggesting a medical procedure developed by or for Black people. An explosive device was thrown through Mather’s window with an angry note attached to it. When, in 1721, a smallpox outbreak swept through Boston, only 6 of the 242 people Mather inoculated died (1 in 40), compared to the 1 in 7 among the population of Boston that did not receive this treatment. In 1796, 80 years after Onesimus shared his knowledge with Mather, Edward Jenner developed a vaccine for smallpox and the disease was declared eradicated in 1980.

Every day, we should seek to know more inclusive and expansive histories. During those times when a spotlight is shone, we should pause and challenge ourselves to purposefully seek out histories we never imagined existed. Today, I learnt that one in four cowboys was Black. Phillis Wheatley was the first Black female author to be published, and did that at 12 years old. As more and more of our lives are recorded on CCTV and other surveillance cameras, we can thank Marie Van Brittan Brown and her husband, for the first innovations in home security systems.

I challenge you to find something that surprises you and learn about about the Black woman who took down Lucky Luciano. Or maybe you might find something that makes your life a little easier. Or find and share something that we don’t even know about. Let’s add layers to history and transform the image of the history makers and enter history without preconceived ideas of who our history makers are. Because, really, anyone can make it.

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Inspiration My Two Cents

Living the Dream

“The soft-minded man always fears change. He feels security in the status quo, and he has an almost morbid fear of the new. For him, the greatest pain is the pain of a new idea.” As we celebrate Martin Luther King Junior’s birthday and legacy, I pulled up some of his quotes. His Dream Speech is one we know and hear but, as is the case with people, he was a lot more than one moment. Dr. King’s commitment to service and justice are examples to live by.

When Dr. King was alive, he was not always popular but he kept on because, as he said, “When you are right you cannot be too radical; when you are wrong, you cannot be too conservative. ” Doing what he felt was right was often very hard for Dr. King. When I say hard, I don’t mean hard like when someone, like me, who is not a morning person, wakes up before the chickens in order to get my morning run in before my workday. I mean hard like if you decide to stand up for what is just, it may lead to the imprisonment, harm, or death of you and maybe even some of your loved ones. Dr. King, and those who he worked with, made unimaginable sacrifices in the service of others.

Sometimes, the thought of action can be so overwhelming that it keeps you in the thinking (and maybe watching videos about it) phase. When I first started running long distances, the furthest I had run was around four miles and I was spent at the end of those miles. Even though I watched New York Marathoners run past my block and they looked like regular folk, I believed they must be exceptional beings because, as far as I was concerned, regular folk couldn’t possibly run further than five miles without collapsing. I met a woman who urged me to start with trying to complete a 10k race and see how that went. Then she suggested a half marathon. You should have seen me at the end of that half marathon! You’d think I had found the answer to all life’s problems, that’s how elated I was. I then decided to tackle the marathon. As I had conquered each mile, I believed more and more that regular old me could be one of those running down Fourth Avenue in Brooklyn, on my way to completing the New York Marathon. It took the little things to get to the greatness of the marathon. To get to that though, I had to inch from under the massive shadow of intimidation and inch slowly to 26.2 miles. It wasn’t always steps forward; I have lost count of how many times injury and illness have taken me back to mile one. However, I do know now that not even trying is so much worse.

Dr. King knew that service is not an easy thing to dive into and often we are so overwhelmed by all that needs to be done that we end up doing nothing. We don’t have to save the world all on our own. If we all do what we can, together we can do amazing things. In the words of Dr. King, “Everybody can be great … because anybody can serve… You only need a heart full of grace. A soul generated by love.” Even during this pandemic, there are opportunities every day to serve and you don’t even have to figure it all out on your own. Organizations such as Americorps can help link you up with opportunities and there is an incredible range of ways in which you can serve, from sending card and letters to those who feel alone, to donating to food and clothing drives. You can also welcome and encourage service in others. When someone does something good for you, even if you don’t need it, show your appreciation and resolve to pay it forward. When someone holds a door open for you, it’s not because they think you don’t know how to open a door, it is a way of showing, in a small way, that they see you and want to do a nice thing for you. That a great thing. Don’t limit yourself to just the one day. May the National Day of Service be a reminder of the value of serving every day. Each of our small acts will bring positive change.

There are books, films, a podcasts about Martin Luther King Jr. I wouldn’t know where to start in recommendations. What I can say is that each time read, watch, or listen to something on Dr. King, I learn something new. I learn more about him, about the Civil Rights movement, and about those around him. Part of the Civil Rights movement is path to a place where more voices are heard and valued, and one marvelous gift that comes with hearing more voices is that we get to see and learn history through different sets of eyes. There is the parable of the blind men and the elephant. Each blind man felt a different part of the elephant and came away believing that they knew what an elephant was. They argued with each other, each believing that they knew the elephant. Yet, the full picture of the elephant could only come through their collective knowledge. So take the time to find a new facet of the life and times of Martin Luther King Jr. and understand not only the impact of the good he did but also the remarkable challenges he faced throughout his life to his early passing. Celebrate Dr. King’s legacy and “Never, never be afraid to do what’s right”.

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Inspiration My Two Cents What's Going On?

What’s Up 2021? My Three Words

Image by Gerd Altmann from Pixabay

The last time I set my 3 words was in 2018, picking Imagine, Innovate, and Act. Led to Chris Brogan by Tom Hood, I was first inspired to do this in 2013. I appreciated the process of thinking about the year I had gone through and then considering the year ahead, and I liked the idea of having a theme song to guide my year. I am a runner and hills are my nemesis. Many years ago, I read that repeating a mantra such as “I love hills” as I soldiered up those slopes (and sometimes almost cliffs) would change my mindset and make things easier. I did find that coming to the hills with a predetermined script kept my mind and mouth from going to soliloquies that included, “When will this end?”, “My legs are dying”, and “Why doesn’t this get easier?” and throwing in a thumping rhythm did get me up and over those hills (it seems that mantra has set itself in my mindset. I talked about them in 2018 as well). If that works with the hills, I am finding that having my three words, putting them where I can see them, and referring to them often helps me reset and refocus. The title of my 2018 post about my three words included “We’ve Got This”, words in some form that I have whispered, muttered, and yelled to myself over the past couple of years and words that friends and family have encouraged me with often during that time. I love to dance and I am ready for my 2021 theme!

Gratitude: It is very easy to be grateful when you are at mile 10, on a hot day, and someone presents you with clean, cool water to drink. You don’t even have to think about the gratitude, your desiccated self defaults to waves of intense thankfulness. On cold, dark, rainy days when that alarm goes off and you have to drag yourself out of bed, finding a reason to be grateful is a challenge. Last year, I put a piece of paper on our fridge, with the heading “3 Good Things”. Every morning (that is the goal) my husband and I each write down 3 things that we are grateful for. Some days it is definitely more challenging to find those things but it is on those days that the 3 things are so vital.

The past year has been one filled with meditations on gratitude. Many of us have had to make unexpected, unplanned, and painful adjustments and it has been easy to lose sight of the silver linings. When gratitude hits me, it can touch me so deeply that it brings tears or it can excite and exhilarate me, like a shot of adrenaline. I intend to continue in prioritizing gratitude not only because of the many studies that tell us how important it is, but mostly because it reminds me of how amazing my life is due to the people, experiences, and things I am grateful for.

Purpose: This word danced its way into my 2021 brain. Purpose here is a many-layered word. I am constantly seeking purpose at the macro level, be it with my life or with my work. I am also thinking about purpose at the micro level. I have been practicing meditation for a bit now (and I have to remind myself it is a practice and a journey) and in addition to seeking a more mindful existence, I also seek purpose. Very little happens without purpose and intention and even more happens with it. So, not only am I asking myself, what is my purpose, I am also asking when I speak, think, or act, what is the purpose of this? I ask myself, what is the goal that I am trying to achieve here? When I get on my bike, I have a default happy flat places gear that it tends to be in. However, when things change – maybe I’m going up a hill, or maybe I want to accelerate – that default gear does not cut it, it takes me to a place full of effort and devoid of happiness. Pausing to think and adjust gets me to efficiently get back to my happy place. I am a person who always has a to do list longer than my arm, I am always trying to get things done and not be overwhelmed. I need that reminder to pause and find that purpose.

Evolve: I am all about evolution, even when I am dragged there, kicking and screaming. When I think about evolution, I imagine adjusting and growing to be better for now and the future. As inevitable as change is, generally humans are not very good at embracing it. I know I am not always good at it because, right now, I can hear my mother’s voice chastising me, “Rumbi, you have to be more open-minded”. But because there are so many wonderful things that have come out of my embrace of change, because there are also things that I now know are not for me because I embraced change and because, like it or not, everything is changing, I am looking to not just change but evolve. This evolution can be of my profession, of our workspaces, or of our relationships. At some point if you are not evolving, you are becoming a dinosaur and they didn’t live to tell the tale. Evolution is ultimately about being better, stronger, and all around more awesome. I’m in.

What were my words before?

2013 – Change, Discover & Motivate
2014 – Transform, Pursue & Collaborate
2015 – Receptive, Synergy & Service
2016 – Learn Fear & Community
2017 – Embrace, Persevere & Monchu
2018 – Imagine, Innovate, & Act

I hope that each of those themes are part of my evolution and journey.

Right now, I am grateful, and I am embracing evolution in my purpose. The sun is out. I made my first vision board. I have written my second blog post of 2021.

What are your 3 words? What are your gratitudes?

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Inspiration My Two Cents

Changing Things Up

Photo by Mark König on Unsplash

In March 2018, I was knocked to my knees when Linda, my closest friend, passed away suddenly, while heading home from a vacation. Eleven months later, in February 2019, I was flattened when my little sister, Veneka, passed away, equally unexpectedly. You know how it feels when you are knocked to the ground, and that monster is still sitting on your chest, and someone yells to you to get up. The struggle to standing can take all the energy that you have. You push that monster off of you and, even as you stand, that monster still lurks beside you, trying often to knock you over again. What energy I had left I focused on the functional necessities but I did not have energy for much else. My writing did not fare well. Often I would think about things but, as I do not yet possess the ability to have my thoughts magically transform into writing on a page, there have been many blank pages in my life these last few years.

Though my fingers have been less active, I have had no shortage of thoughts and, when I think, it is about a lot more than financial forensics. When I talk, it is about more than financial forensics. When I act, I do more than financial forensics. So, now when I write, I want to write about more than financial forensics. I have found that, at the core of my thoughts, my conversations, and my actions are the same principles. I want to keep doing that in this space, so we can explore how things like accountability, ethics, and systems are important in various parts of our lives and our work.

I believe that this sharing and these conversations we have, in our small spaces and in our small ways, can indeed alter the face of the world. I am getting out of my head a little bit to share the wisdom I find and to hear the wisdom from you. In this small space of a site, this is a big change so I am, as is human, nervous. However, to quote Babe Ruth, “Never let the fear of striking out keep you from coming up to bat.” And this is where my baseball analogies will stop before I am outed as someone who grew up on rounders and then cricket, before baseball.

I’m up to bat!

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Inspiration My Two Cents PSA

It’s All Good

adult-american-football-athlete-209954

I have written before about the importance of whistleblowers as a prime tool for detecting and discovering fraud. The ACFE’s 2018 Report to the Nations states that 40% of frauds were discovered through a tip from a whistleblower. This is, by far, the most common way in which fraud is uncovered. At 15%, internal audit came in a distant second. That’s huge. It is important to note that, in a business, a whistleblower can report wrongdoing in many areas – dangerous weaknesses in the design of a product, dishonest marketing and anything else going awry in an organization.

The history of the whistleblower in America dates back to the late 1700s when ten members of his crew and 2 citizens reported Esek Hopkins, the nation’s first commodore, for torturing British prisoners of war among several allegations. Hopkins was suspended and, in turn, retaliated by having the whistleblowers arrested. These whistleblowers appealed to the congress claiming that they were “arrested for doing what they believed and still believe was nothing but their duty”.  Congress responded by creating the country’s first whistleblower protection law. I love this story because it covers the entire whistleblower cycle. First, we have people seeing behavior that they believe is wrong and then taking steps to report this. We then have authorities taking action on the reported wrongdoing. We see the ugly side of things when Hopkins retaliates, something that, unfortunately, happens too often when whistleblower complaints are filed. Finally, we have whistleblower protections, as lawmakers recognize that it is important to have a system in place that protects those who call out what is wrong.

Sadly, this was not the moment when the world realized the importance of the whistleblower, holding the role in an esteemed position, where whistleblowers would be lauded and admired for all time. Instead, over time, in all spaces, including the movies, whistleblowers were given a bad rep and uncomplimentary labels like “snitch”, “informer” or “rat”. Instead of being admired for uncovering wrongdoing, whistleblowing was viewed as violating a sacred code of silence. We were being told that it was better to be a criminal, stealing money, jeopardizing people’s livelihoods and sometimes even their lives, than to be the person shining the light on all of this. We found ourselves in a space where, yes it’s terrible if someone runs off with your money or turns a blind eye to safety in a product, in pursuit of profits, but it is so much worse if someone tells us about it.

In 1971, Ralph Nader, the famous consumer activist, made it his mission to remove the tarnish from whistleblowing. He described whistleblowing as “An act of a man or woman who, believing that the public interest overrides the interest of the organization he serves, blows the whistle that the organization is involved in corrupt, illegal, fraudulent, or harmful activity.” He worked tirelessly to put a positive spin on the word whistleblower and as people view the role more favorably, whistleblowers can be better protected from retaliation.

We should recognize that it is not easy to be a whistleblower. Most people have a level of loyalty, if not to their job, then definitely to their colleagues. When they see fraud or other wrongdoing happening, they are torn and conflicted and often hope that they are wrong. Most of us like the people we work with and may know about their families and may even socialize with them. The second last thing we want is to find out that a coworker is perpetrating a fraud, only because the last thing we want is to be the person reporting this. At times, people will leave a job before they report a fraud. Other times, a person will keep quiet, hoping that someone else takes on the burden of reporting the fraud. It is a heavy emotional burden.

This is all before a whistleblower has to consider possible retaliation for reporting that wrongdoing. Many people fear losing their job or being ostracized after blowing the whistle on fraud. Unfortunately, sometimes these people are correct. At times the retaliation will not be overt but can happen in insidious ways where those retaliating try to find loopholes and legal ways in which to push a whistleblower out. When this happens, any other potential whistleblowers can be scared into silence. We tend to find out about this retaliation when a fraud is uncovered and we discover that, perhaps for years, others had tried to report the fraud but were fired, ostracized as people who were not team players, or treated as though they were insane for suggesting such a thing.

With these things in mind, it is paramount to business leaders and all others to act to hold whistleblowing as a positive action and to encourage and protect whistleblowers. Unless you are a leader perpetrating a fraud at your organization, why wouldn’t you want a whistleblower in your midst? Here are a few steps you can take to make this happen:

  • Your onboarding process should include information to employees encouraging whistleblowing and giving them clear and easy ways in which they can make reports.
  • Provide employees with an anonymous way in which they can share a tip. Also provide various places or a third party, in case the whistleblower does not feel that the option provided is one that is safe and one that will act on the tip.
  • Have zero tolerance for retaliation. This should not only be communicated to employees but be an active part of your company’s culture.
  • Show clearly that you have acted on a tip and that such actions are encouraged and appreciated in your organization.
  • Keep information on reporting whistleblowing prominent in your firm and remind employees regularly.

We are in the midst of football season and many fans are very upset with referees right now because it seems they are not making calls that they should, and they are letting players get away with things that lead to what fans view as unjust outcomes. If we feel this strongly about referees blowing the whistle on bad plays, shouldn’t we be bringing at least the same level of passion to blowing the whistle on wrongdoing in businesses and other organizations?

 

Categories
In The News Inspiration PSA

Nobody’s Perfect

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Barings Bank was the United Kingdom’s oldest merchant bank and the second oldest merchant bank in the world. In 1992, the bank sent 25-year-old Nick Leeson to be the general manager at its new office in Singapore. During that first year there, Leeson made unauthorized trades that earned Barings £10 million in profits. The bank should have had a system where one person was a trader, and another was double-checking and then authorizing these trades. Instead, Leeson did everything with no checks and balances. Yes, these trades were unauthorized, but they made the bank a lot of money and so, instead of nipping the unauthorized trades in the bud, Barings paid Leeson a massive bonus and labeled him a rising star. Things changed very quickly, and Leeson started losing money on his trades. Instead of reporting his losses, Leeson hid them in a suspense account, that he created and tried, unsuccessfully, to recoup his losses. He would then hide those losses in this suspense account as well. By the end of 1994, the losses stood at £208 million. In February of 1994, Leeson left a note stating, “I’m sorry”, and fled Singapore, leaving Barings Bank with £897 million in losses (equivalent to $1.4 billion). Barings Bank could not recover from those losses and, after being in business since 1762, collapsed and was bought by ING for £1.

The story of Barings Bank and Nick Leeson is like one of those puzzles where you circle the ten things wrong in a picture – there are that many problem areas and weaknesses that led to the downfall that we could revisit this story many times for lessons. Today we shall focus on Nick Leeson hiding his bad bets. Initially, Leeson made errors and miscalculations on some trades that he made and lost money from those errors. From some of the accounts from Leeson, it is implied that mistakes were not looked upon kindly. Leeson claimed that he first opened the suspense account in which he hid losses after a colleague lost £20,000 after making an error herself. Instead of either one of them reporting the error, they decided to hide this error from leadership. Nick Leeson then went on to hide more of his trading errors here, thinking, in the manner of a gambler, that he could gain the money he had lost back, and his bosses would never find out what he was doing.

I thought about Nick Leeson this week because I am reading Principles by Ray Dalio. In it, he tells the story of how his employee Ross, who was in charge of trading at the time, forgot to make a trade and that cost the business “several hundred thousand dollars”. Dalio tells us that, with such a costly error, he could have dramatically fired Ross and “set the tone that mistakes would not be tolerated. Instead, Dalio recognized that mistakes happen to us all the time, he himself had made mistakes so large that he had essentially lost his business at some point. Dalio’s approach, which is an approach that I am a huge fan of and have tried to follow for a long time, is to think about what to learn from mistakes and how to improve things to minimize the chances of those mistakes happening again, or at least how to minimize their impact should they occur. As I have written before, Dalio recognized that punishing Ross for his mistake would likely result in other people working hard to hide any errors. Dalio saw that would cost his business a lot more in the long run. At his firm, Bridgewater, Dalio and Ross created an error log where errors were tracked and addressed. Instead of people getting into trouble for making mistakes, they would get into trouble when they didn’t report mistakes.

With Leeson (and Barings Bank) and Dalio in mind and the different outcomes that have resulted from their approaches to dealing with mistakes is very telling. One person brought down the second oldest merchant bank and the other has what is considered to be the fifth most important private company in the United States. Some things to keep in mind when considering how to manage responses to errors in your business:

  • Create an environment where everyone is comfortable reporting errors that they have made. Be explicit with this, both in what you say and how you respond.
  • When you discover a mistake, take the time to look, with your team, into how this mistake might have been avoided or recognized and resolved earlier. An example is, with a missed trade, it is likely that Dalio and his team looked at the process and sought to put in checks to make sure that there were others aware of the trade, checking to make sure the trade was made and having a way to check in with Ross to make sure he had not forgotten.
  • Review your systems to see where there are checks and balances and if especially important areas are not put on one person. Make sure that someone else is checking – we all make mistakes and that is why there is a checking system. Not to make us feel bad about ourselves but in recognition of our humanness.
  • Have open discussions about errors and get input from all levels on how to avoid or detect errors. At the leadership level, you may come up with a system, but you may find that staff find that process cumbersome, don’t stick with it and errors can go undetected for a while. And if an error has not even been detected, it can’t be reported.

These are just a few things to think about but the most important part is creating an environment that is open to communication, not just about success, but about the things that have gone wrong. You should think about making the environment open for the hard conversations the priority because it is simple to report and celebrate success but failure and error are what kill our business. With that in mind, are there situations that you have found yourself in where either you or someone on your team made a mistake? How did you respond, how did others respond, and how did things turn out?

Categories
Inspiration PSA The Nitty Gritty

Even When You Don’t Want To…

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Linda Kadzombe

Linda was not my friend. I was in high school, sitting in the car, in the school parking lot, with my father, waiting for my little sister to show up. She ran up, with a friend and they stood by the car, smiling and sporting matching nose rings. My father looked up and the two girls, and their matching noses, and exclaimed – “I suppose nose rings are part of the school uniform now.” That is my first significant memory of Linda, who was my sister’s friend. Along with a great group of friends, Linda and I rang in 2000 in Victoria Falls. We talked about the fact that we were both moving the United States and we promised to keep in touch with each other. This vague promise turned into a relationship that the word “friend” does not do justice. With our families far away, we checked in with each other almost every day and often the conversation started this way: “Just checking in. I’m alive.” Once, I called Linda when I stuck in a dress I had ordered online and that I was trying on. She was living in Boston and I was in New York City and yet, she was the first number I thought of dialing. We were travel buddies and talked about becoming the sweet old lady travelers that we often came across during our trips. We shared a love of European chocolate and I was a person she taught, and gave permission, to stab her with an EpiPen should the need arise.

On March 6th, I received a call that had never even drifted into my imagination. While flying back home from an epic vacation with her cousins, Linda passed away. The news was devastating; it still is. At the same time, there was a lot to do. Whether or not you have planned for death, when death happens, there is a lot that needs to be done, not only to put your loved one to rest but also to sort out your loved one’s affairs. Friends and family came together for Linda and, as we navigated various issues, we were frustrated, energized, and touched, often all at the same moment. It made me think about the importance of planning, not only for the workplace, but also for one’s personal life.

The first step is the dreaded will. No one wants to ever think about their mortality but, even when you think you have nothing, you always have enough to put in a will. At the very least, you have your wishes. Even when you think to yourself – oh, I am single, and/or I don’t have children – you still should have a will. Remember that a will is a legal document and you should be sure to comply with the law, or your will may not be accepted as binding. For instance, the rules about whether or not a handwritten will is recognized varies by state. You should also see if your financial accounts can be set up to be transferrable or payable upon death, as this will save survivors the headaches of dealing with probate court. In addition to letting people know what you want done with your stuff, you should also think about how and where you wish to be laid to rest, if that is something that is important to you.

We live in an age of paperless billing and most business being transacted through online accounts. This means that, for many of us, all our accounts have a login and information about accounts and their existence may only exist in our email accounts. To questions about what accounts and liabilities Linda might have, we could only shrug and guess. Dashlane estimates that the average user has 90 online accounts! Consider making a list of your accounts that you will keep safeguarded in a safe, or with a lawyer, if you keep your will with a lawyer. There are various ways in which to work to both safeguard your personal information and also ensure that your accounts are known and closed correctly, after passing.

If you don’t already have it, get life insurance. The policy doesn’t have to be a big one; just enough to cover the costs that may come up due to death. These include:

  • Payment of final expenses;
  • Taking care of your loved ones, if you have loved ones that depend on you;
  • Payment of debts, so that your next of kin are not on the hook for them;
  • Payment of estate taxes

It may seem horribly morbid to talk about death and it is certainly no fun to deal with the affairs of a loved one. In the midst of grief, you don’t want to deal with some of the headaches that can pop up around the administration of everything – dealing with hospitals, funteral homes, airlines or whatever. Fortunately, Linda had an amazing network of people who loved her (and some incredibly kind strangers who saved the day more than once). All worked hard to get her home and laid to rest near her family. We also were able to spend a lot of quality time with friends and family that we had long promised to spend time with you. You know how that happens – next week, next month or next summer turns into ten years. However, through it all, we had a lot of figuring out how to do something or where to find things because we had never even thought about navigating this terrain.

Take some time to think about what you have and what you want done about it. Talk to your loved ones and tell them to make plans, if they have not already. Remember that it is never too early to plan and, unfortunately, often too late.