HP should have listened to its CFO

November 20, 2012: 3:12 PM ET

Hewlett Packard's beleaguered chief financial officer, Cathie Lesjak, went to great lengths to voice her opposition of the Autonomy acquisition.

By James Bandler

catherine-lesjak

HP CFO Catherine Lesjak sounded alarms.

FORTUNE -- Inevitably, after a scandal of this proportion breaks out, finger-pointing and blame-ducking commence immediately. Hewlett Packard's announcement Tuesday that it's taking an $8.8 billion hit on its $11 billion purchase of Autonomy is no exception. HP says the lion's share of the charge was related to "serious accounting improprieties" and "outright misrepresentations" at Autonomy, the British software maker it acquired in October 2011. The alleged accounting misdeeds, which HP says occurred before the acquisition, are being investigated in the U.S. by the SEC.

But there's at least one senior person who shouldn't be singled out for condemnation in this mess: HP's (HPQ) beleaguered chief financial officer, Cathie Lesjak.

In the summer of 2011, Lesjak earned the wrath of then CEO Leo Apotheker when she forcibly opposed the Autonomy takeover -- not because she suspected fraud, but because she believed the valuation absurd. Unable to get Apotheker to see her way, she took her case to the boardroom in a highly unusual and dramatic plea to scotch the deal.

As Fortune wrote in its May cover story How Hewlett-Packard lost its way:

"...with no warning to Apotheker, Lesjak made an impassioned case
against the acquisition before the board. "I can't support it," she
told the directors, according to a person who was present. "I don't
think it's a good idea. I don't think we're ready. I think it's too
expensive. I'm putting a line down. This is not in the best interests
of the company." Directors were shaken. Lesjak was considered a voice
of sobriety, and here she was on the verge of insubordination,
directly resisting a key element of her boss' strategy."

Lesjak's move was shocking (and Apotheker never forgave her for it) -- but ultimately she didn't carry the day. In August 2011, the board, which included Whitman as a newly appointed director, approved the Autonomy deal unanimously. A month later, Apotheker was out as CEO and Whitman was in.

You can bet she and the rest of the board wish they'd listened to Lesjak, who remains CFO.

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