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Syndicated columnist Andrew Leckey takes the reins at COM’s Business and Economics Journalism Program
By Brian Fitzgerald
Earlier this year, journalists bit into the remains of Enron as savagely as hyenas. And they’re still chewing. But where were the media watchdogs when the company was overstating its earnings?
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| Andrew Leckey is a nationally syndicated columnist for the Chicago Tribune and is a former CNBC financial network anchor. Photo by Kalman Zabarsky | |
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“I think scandals at companies such as Enron, WorldCom, and Global
Crossing show that it’s obvious that many people — including
journalists — should have been looking more closely at these companies,”
says Andrew Leckey, a visiting professor who this fall began overseeing
COM’s graduate Business and Economics Journalism Program.
Leckey says that he wants today’s business journalism students to
be tomorrow’s pit bulls in the field — able not only to report
on business scandals with fervor, but also to discover the warning signs
of scandals before they break.
“As a result of the Enron situation,” he says, “people
are saying, ‘Didn’t business journalists miss the boat?’
However, I have a copy of the Enron annual report for a class I was just
teaching. There were a number of money-losing businesses that it simply
didn’t include in the report, or in any of its financial statements.”
Leckey says Enron had created a constellation of partnerships that allowed
managers to shift debt off the books. “A team of analysts didn’t
find those areas in which the company was losing money,” he says,
“because this information wasn’t included.”
Leckey points out that Enron’s true nature would have been a difficult
story to untangle before the Securities and Exchange Commission (SEC)
investigated the company’s partnerships. Shortly after the investigation
began, Enron revealed that it had overstated earnings for the past four
years by $586 million and that it was responsible for up to $3 billion
in obligations to various partnerships.
“Another example is finding out from Jack Welch’s divorce
proceedings that he got all of these incredible perks after he retired
from General Electric,” says Leckey. Little of former CEO Welch’s
retirement package — the sweetest in corporate history — was
disclosed to GE’s shareholders until Welch’s wife blew the
whistle.
And because of the Enron debacle, which left thousands of employees without
jobs and with nothing left in their 401k retirement accounts, federal
regulators are now pushing for changes in the way companies record financial
transactions, including a move to have chief executives personally vouch
for the accuracy and completeness of information in their company’s
reports to investors. “Still,” says Leckey, “there is
always going to be fraud. Perhaps what we’ve learned from this is
the importance of journalists using shoe leather and really reporting
on stories — hanging out with people who work at a company, talking
to friends and neighbors who might have a connection to it, looking at
all the possible places that you can gain any information on a company.
The problem with Enron was that too many people relied solely on the numbers.”
Leckey, a nationally syndicated columnist for the Chicago Tribune, and
a former CNBC financial network anchor, takes over a COM graduate program
that caters to students who want careers in what he says is “one
of the most dynamic and exciting fields in journalism.” Before arriving
at BU as a replacement for COM Associate Professor of Journalism Steven
Levingston, who is now the business editor for the International Herald
Tribune in Paris, Leckey was director of the business reporting program
at the University of California, Berkeley.
“Talented reporters capable of uncovering the real stories behind
the numbers are in demand by print, broadcast, and online news organizations,”
he says. He is teaching the program’s new Introduction to Business
and Economics reporting course, which is the first step for those who
wish to remove the “fear factor” of the field. “People
often turn on CNBC and see all these numbers and letters flying across
the screen, and have no idea what they mean,” says Leckey. “They
get intimidated.” The course helps students learn the basics of
stocks, companies, and the economy. They also learn how to dissect financial
statements.
For those who want to dive headfirst into this challenging profession,
the program offers a master of business and economics journalism degree,
over three semesters that includes more advanced course work in business
journalism, as well as courses at SMG and the CAS department of economics.
The third semester consists of an internship with a professional news
organization — including an option to participate in COM’s
Washington Journalism Program, where students report for newspapers on
agencies such as the Federal Reserve Bank, as well as business-related
congressional issues.
“Over the years in the media, business and economics journalism
has evolved into an international, electric, daily coverage area,”
Leckey says. “Every beat has a business angle.” Among his
former students at Cal-Berkeley who have distinguished themselves as business
journalists are Greg Winter and Sheri Day of the New York Times and the
Boston Globe’s Chris Gaither.
Will one of his BU students eventually break the story on a future scandal?
Leckey provides no predictions — except for more fiscal wrongdoing.
“There will be more Enrons,” he says. “I can guarantee
you that. No matter what rule the SEC puts into place, some people are
always going to lie and cheat. In the case of Enron and the others, I
think that reporters were too willing to listen to analysts on Wall Street.
In a bull stock market, the public wanted to hear good things about these
companies. They weren’t really interested in the bad things. Hopefully,
journalists will dig deeper next time.”
8 November 2002
Boston University
Office of University Relations