Putting together a great live conference is harder than it looks. For one, it costs money, but raising the funds can generate conflicts of interest. Major media organizations try to avoid such conflicts when they co-sponsor for-profit conferences with companies and executives they cover. Professional associations and trade publications, by contrast, produce conferences specifically to provide specialized “thought leadership” to discerning, pre-qualified targets of their vendor sponsors. In other words, they tend to be less circumspect about ethical issues.
A few months ago I was invited, then abruptly disinvited, to speak at a gathering of ethics and compliance professionals. To my chagrin, even those who recommend legal and ethical best practices to others will bend for the big bucks.
The trouble starts when sponsors stick their noses into selecting speakers and critiquing speeches. When a conference runs on a "pay to play" basis, it’s organized to sell to you. “Platinum” or “Diamond” level sponsors, the big money, receive prime banner and booth placement and often get exclusivity clauses — the right to bar competitors from participating. They often push for veto power over speakers and content. “Bronze” or “Cubic Zirconium” sponsors settle for a logo on an eco-friendly tote bag or the privilege of leaving company pens near the coffee and bagels.
The annual conference for the Ethics and Compliance Officer Association (ECOA) — a member organization of ethics and compliance specialists — showcases two speakers each year on an issue of critical interest to members. The session is billed as “The Great Debate.” The question for last fall’s event: Does ethics training change behavior?
ECOA approached me late, due to another speaker’s cancelation, to be one of the debaters at the September 2013 event. I readily agreed for the opportunity to take the “No” position against DePaul University Professor of Business Ethics Laura Pincus-Hartman. (Professor Pincus-Hartman and I had previously appeared together on a segment of local public television program Chicago Tonight.) As a CPA, former internal auditor, legal and regulatory compliance consultant and, now, journalist covering the business of the Big Four global audit firms, I am well qualified to discuss ethics training and provide great stories of those who didn't learn the lessons.
Admission to the conference is expensive: $2,350 for non-members, $1,850 for members. Organizers also solicit additional contributions from sponsors and vendor fair exhibitors. It’s a for-profit conference run by a not-for-profit professional association. I agreed to waive my usual speaking fee as a favor to the ECOA member who had recommended me.
Trouble arrived a few weeks before the event. The conference organizer sheepishly admitted on a planning call that he had been unaware of my “reputation” as an “accounting watchdog” that “speaks truth to power.” He asked me to promise not to “disparage or insult” any of the sponsors or other speakers.
I thought the Big Four audit firms had gotten used to me by then. I speak regularly at universities, to academic groups like the American Accounting Association (AAA) and to organizational meetings such as the Society of Corporate Secretaries and Governance Professionals Annual Conference, the Compliance Week Annual Conference and the Institute of Internal Auditors conferences.
On a Friday, two days after the planning call, the conference organizer phoned me to say “speakers” were threatening to boycott the “Great Debate,” cancel their own appearances and even cancel memberships if I remained on the program. I suspected the complainers were people who worked for sponsors such as the Big Four audit firms — PwC, Deloitte, KPMG and Ernst & Young. The first three have professionals who also sit on the ECOA board of directors. Since I’m a regular critic of the audit industry, they may have been unwilling to pay, via their sponsorships, to listen to me. Also, the case of Scott London, a senior KPMG audit partner who had pled guilty to sharing confidential client information with a friend who traded on it, was fresh in the news. London is a prime example they may have been afraid I’d use to prove that even someone whose profession specifically required ethical behavior can behave badly.
How much was at stake if ECOA stood up to them? At least $90,000 had been collected from just three Big Four firms and two corporate sponsors I’ve criticized in the past. ECOA could also lose membership dues and board members. The Deloitte Foundation paid $35,000 for a “Diamond” sponsorship. KPMG ponied up $15,000. Thomson Reuters, a media and software firm I’ve criticized for a business relationship with its auditor PwC that I believe violates auditor independence regulations, also spent $15,000. Merck, another PwC client, contributed $15,000, too. Ernst & Young chipped in $10,000.
The final word came early the following Monday morning from Tim Mazur, the ECOA Chief Operating Officer and conference organizer. “More calls came from speakers on Friday afternoon,” he told me. “I deeply apologize for my underestimating the speakers’ reactions.”
Matt Kelly, publisher and editor in chief of trade publication Compliance Week, runs a highly successful annual conference, with many of the same attendees and sponsors as ECOA’s. I asked Kelly how he manages pushy sponsors:
As a trade magazine our objective is to, first and foremost, serve our niche. We have a responsibility to our attendees and to prospective sponsors to be clear and transparent about how we are programmed.
A conference that is 100 percent programmed by sponsors is not going to be one our audience values. Trade conference attendees are discerning. They will not pay to be sold to.
The Institute of Internal Auditors is led by Richard F. Chambers, its president and chief executive officer. The IIA produces several conferences every year for its members in the United States and internationally. According to Chambers, sponsors are an important part of running successful conferences:
We invite sponsors to nominate speakers but have a rigid process of vetting them and their content to make sure members’ needs are met.
We take very seriously our responsibility to ensure the integrity and quality of our conference programming. We have no agreements that give sponsors exclusive control over programming or veto power over speakers.
Deloitte also co-hosts the FT Global Pharmaceutical and Biotechnology Conference: New Businesses, New Markets. A spokesman for the Financial Times told me there’s no more free ride for sponsors. They pay for the privilege of being associated with the FT. “Deloitte earned the exclusivity clause,” he said.
Deloitte is also the new sponsor of the Cambridge Union Society, the celebrated debating club of England’s Cambridge University. The Union insists it will remain dedicated to free speech in spite of this unusual commercial arrangement. However, one Union member told reporters:
In any kind of corporate deal of this sort there are tacit understandings about what can and can’t be said about the other party. That just doesn’t bode well for a centuries-old debating society whose tagline has the words ‘free speech’ in it.
According to the Union, Deloitte is not allowed to choose speakers or debate motions. Perhaps we can count on free speech at the Union. However, at other venues, you may be hearing only who and what the sponsors dictate.