HP CEO Hurd Describes ‘Rogue’ Probe

Hewlett-Packard Chief Executive Officer (CEO) Mark Hurd blamed the scandal that has besieged his company on “a rogue investigation” that got out of hand, in an advance copy of his congressional testimony released by a House subcommittee on Wednesday.

“How did such an abuse of privacy occur in a company renowned for its privacy? The end came to justify the means,” Hurd wrote. “The investigation team became so focused on finding the source of the leaks that they lost sight of the privacy of reporters and others. They lost sight of the values HP has always represented.”

HP CEO Mark Hurd

Former HP Chairwoman Patricia Dunn, forced to resign Sept. 21 because of the scandal, defended in her testimony her decision to investigate the leaks of confidential board discussions to the news media.

In her testimony, Dunn wrote that she knew investigators were obtaining the phone records of people it was investigating. Lawyers for HP and for an investigation firm carrying out the probe assured her the tactics were legal, she wrote.

“I was fully convinced that HP would never engage in anything illegal,” she wrote. “Given that attorneys were unambiguously overseeing the investigation … reinforced my understanding that the investigations were being handled appropriately.”

Both are among several witnesses expected at a hearing before the Oversight and Investigations Subcommittee of the House Energy and Commerce Committee on Thursday in Washington. The committee is looking into the practice of “pretexting,” or using false pretenses to gain access to confidential records. Investigators hired by HP to find the source of leaks engaged in pretexting to get hold of the phone records of directors, HP employees and reporters who cover the Palo Alto, Calif., technology company.

Hurd, echoing comments he made in a news conference last Friday at HP’s headquarters, said he was determined to get to the bottom of this episode and to try to restore HP’s image.

“I pledge that HP will take whatever steps are necessary to make sure nothing like this ever happens again,” he wrote, “and that this company will regain not just its reputation … but its pride.”

Although much of the criticism of the scandal surrounds the tactics used by the investigators, Dunn wrote in her testimony that equal consideration should be given to the leaks from within the company that damaged HP.

HP’s board was notorious for its leaks to news media, and such disclosures made it difficult for the board to deal with important issues candidly, she wrote.

Dunn explained that board deliberations on the selection of a replacement for former CEO Carly Fiorina in 2005 were leaked. She cited a BusinessWeek magazine story “disclosing opinions about various candidates and revealing details about … the search process.”

“If you were a top CEO candidate, would you want to work for a company whose board could not be trusted to keep such information confidential? HP is very lucky to have been able to recruit Mark Hurd under such circumstances,” Dunn wrote.

“I wish fervently that none of this had ever happened,” Dunn continued. “But boards have an unquestionable obligation to take steps to prevent [leaks]. That certain steps taken during the investigation went well beyond what was appropriate does not undermine the importance of the board’s mission in this matter.”

Hurd also outlined several steps the company is taking internally to clarify its privacy policy for employees and to emphasize it in employee training programs.

-Robert Mullins, IDG News Service (San Francisco Bureau)

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