Are Tech Companies Fraud Magnets?
from the not-really... dept
With all the corporate sleaze going around these days, the finger keeps getting pointed at tech companies, as if they were somehow the real reason behind lying/cheating/stealing executives. The E-commerce Times is wondering if tech companies are magnets for fraud. They speak to some analysts who blame the stock option culture of tech companies – but I think that’s not really fair either. It isn’t stock options themselves that lead companies to lying about their earnings. A more reasonable explanation is simply that technology companies were under tremendous pressure from investors of all types to grow at insane rates. Once some companies started using “creative” accounting, others felt the need to follow suit, just to keep up. There’s nothing about technology companies specifically that makes them prone to fraud. It’s companies that have ridiculous pressure to grow at impossible rates that are going to push the envelope.