Karen Golz discusses her pioneering career, the importance of transparency and how she seeks to find the good in difficult circumstances.
No challenge seems too big for Karen Golz. That was true throughout her 41 years with EY, and it remains so in retirement as she continues to gravitate toward thorny issues she can help resolve. After joining the firm in 1976, she paved the way for other women, and when the time came for her to retire as Global Vice Chair, Professional Practice, she continued a bit longer to help EY Japan through a reputational crisis. Today, she’s embracing the role of interim chair of the board of directors of USA Gymnastics (USAG) in the wake of the Larry Nassar scandal.
You’ve been blazing trails since 1980, when you became the first woman audit manager in Arthur Young’s Milwaukee office. What was that first experience with the firm like?
There were very few women, as you can imagine, but it was a fantastic beginning. I remember the many lessons the partners and others taught me: how to interact with clients in a direct but polite manner and how to build strong relationships. My time in Milwaukee laid the foundation for my later career successes.
You’ve said your move to the Boston office in 1982 offered a lesson in transparency. How so?
I moved to Boston because my then-fiancé (now husband of more than 35 years) had a new job, but I was afraid to tell the Milwaukee office managing partner, Bob Moore. When I finally did, he immediately connected me to the managing partner of the Boston office, Tom McDermott, and the rest is history. It was an important lesson for me, as a young professional, about being open and transparent. If you’ve been fair to the firm, the firm will always be fair to you. And that has absolutely been borne out throughout my entire career.
In early 1984, you left EY for a couple of years. What brought you back?
An entrepreneurial opportunity: Tom McDermott enticed me back to open an office for Arthur Young in Manchester, New Hampshire. I lived in New Hampshire, so it was a chance to work closer to home. And it was so much fun. We had great people and attracted terrific clients — many of which remain clients today. That’s where I learned about securing new clients, which served me well later. I became a partner in 1987 and was the first woman audit partner in New England.
A trailblazer again!
Yes, but so were many others throughout the EY organization (EY). And many wonderful mentors bolstered my confidence along the way when I doubted myself. People like retired partner Sue Frieden, who showed so many women how to be a partner. And Dennis Haley, who asked me to succeed him as Professional Practice director for New England. When I doubted my ability, Dennis quickly suggested I was selling myself short, which women oftentimes do. So I took the role, and it proved to be the sweet spot for me.
In 2004, you were asked to assume leadership of the Independence function. How did that shape your career, and how did you shape the role?
That was a watershed moment for the US firm and for me. In the wake of the PeopleSoft crisis, in which Ernst & Young LLP was deemed to have violated the Securities and Exchange Commission independence rules, the firm was strongly sanctioned with a cease and desist order and banned from accepting new public audit clients for six months. I had developed a reputation for tackling difficult client circumstances, and that had already shaped my career. But I had no idea how to take over the Independence function, and at such a difficult time. Fortunately, I had help from lots of people, like retired partners and firm leaders Sue Frieden, John Ferraro and Ed Fraioli. They had more experience, had confidence in me and supported me. So I learned, and quickly figured it out. These are the things that shape you: all these experiences that you try to figure out. And while I was initially the Americas leader, it was clear we needed to raise the bar for the entire network, so ultimately the role became global.
Once the US firm resumed accepting new clients, did you ever have to say no?
Yes, more than some probably appreciated. I remember once calling [former EY Global Chairman and CEO] Jim Turley as he was going into orals for a new audit client opportunity and telling him we couldn’t accept the client because we were not independent. While he was disappointed and wished we had found out sooner, he was fantastic about it. He and [EY Global Chairman and CEO] Mark A. Weinberger later continued to be so supportive of me in this role and subsequent roles, in some difficult and challenging situations.
From 2010 to 2016, you were back in your sweet spot in Professional Practice, this time as Global Vice Chair. You were set to retire in 2016, but you were asked to help lead another EY member firm through a storm.
Yes, EY Japan faced regulatory and client challenges as a result of fraud identified in the audits of Toshiba Corporation, resulting in fines and brand damage. We had to make tough decisions and implement reforms and remedial actions. I know how difficult it is to undertake such transformational actions, and I bring that experience to USAG.
As you look back on your EY career, what are you most proud of?
First, building and supporting diversity and excellence. I actively sought to recruit and retain more women, but I also tried to help people look at things differently — diversity in views. Now, I better understand the value and impact of diversity.
Also, Independence was one of the early functions asked to look at what could be done in a shared service center in India. Many of the systems created and some of the people recruited into the function under my leadership formed much of the basis of what EY has there now. It’s an example of thinking differently and persevering.
I am also proud that under my leadership, we secured EY support for Dan Montgomery to serve as Deputy Chair of the International Auditing and Assurance Standards Board. In that role, Dan had a huge impact shaping what has been internationally and is going to be in the US a very substantial change in the profession, because he chaired the new auditor reporting task force. The auditor’s report hadn’t changed in about 60 years. EY led the way, and I was proud of the support of Global and Americas so EY could have this positive and lasting impact on the profession.
Who are some others you mentored?
Over the years, I mentored many people. Recently, in working on the Enhanced Disclosure Task Force of the Financial Stability Board, I helped provide an opportunity for advancement for Larry Dunn (Assurance) and Kellen Maia de Sa (Risk), whom I had never met before we worked together on that project. And on the EY Japan project, Kaz Fujita, Terumi Katano, Lewis Woodward and Amy Call-Well contributed greatly and were subsequently promoted to partner. Nothing is more satisfying than seeing someone you coached and mentored be promoted.
How did your EY experience prepare you for your USA Gymnastics role?
From the PeopleSoft and EY Japan experiences and others in between, I learned you have to make tough and pivotal decisions. Organizations go through rough patches, just like people go through rough patches in their lives, their marriages, their careers. There’s a lot of good in gymnastics. You can’t deny that a criminal took advantage and that’s horrific. But I also believe the good in USA Gymnastics outweighs the bad. After being appointed, I attended a gymnastics meet, and what I saw was lots of kids with smiling faces. Happy parents, happy kids. And that’s a symbol of the good, particularly at the grassroots level. You have to be ever-vigilant because evil has a way of hiding in the shadows, but there’s a lot of good in the organization, and I’m hopeful it can be transformed and improved. We are an interim board, but the work we’re doing is going to have a long-term impact. Much like what I saw happen in EY Japan and after PeopleSoft with EY, what the interim board helps USAG build might well be used as a template for other national governing bodies.
You’ve led teams through many crises. What are the keys to coming out the other side?
It feels like you’re in the middle of the ocean, and you’re afraid there’s no shore on any side. But there is. You just have to be methodical in how you get there. We get overwhelmed thinking of the tasks to be done and the great need. I’ve been known to say, “I can only focus on four things.” So, we focused on four things: policies, processes, compliance monitoring and training. I called them the four legs of the stool. (In fact, one of my teams gave me a kids’ stool with those words written on the legs, and I have it in my home office to this day.) For example, how does this help drive better policies or better processes that enable those policies? How do we make sure we’re focused on the compliance and monitoring over the policies and processes, and then how do we train people better? You have to commit to asking better questions, listening and changing. And then you not only survive, but thrive and move ahead.
How has the EY family reacted to the news of your USAG role?
I touched base, of course, with Mark A. Weinberger and Americas Managing Partner Steve Howe before I accepted. Both had the same reaction, along the lines of, “This is phenomenal. How can EY help?” I was very proud, but I was not surprised by their reactions because EY recognizes the value of sport and of providing assistance. And I’ve heard from EY parents about how valuable gymnastics has been to their children. Gymnastics helps children learn how to work toward a goal, to focus, prepare and work hard. And because it’s a team sport as well as an individual sport, the athletes have to learn how to work together, too.
The USAG interim board is tasked with evaluating the current board structure and making sure it meets certain standards in terms of size, independence, expertise and representation. What will make for an effective board?
A board has to ask the right questions across the whole gamut of an operation. It has to operate with trust and candor and respect, and that can be hard to do with people you don’t really know. There’s no magic number, but smaller boards allow for more collegiality. Still, you have to have enough people to bring diversity of experience and competencies: legal, risk management, marketing, branding, innovation and, in the case of USAG, athletics, crisis management, transformational change, child advocacy and so forth. The safety and well-being of the athletes must be paramount. And just like corporate boards, you need some independent directors who bring independent perspectives.
How are you continuing to explore and pursue other board opportunities?
I am actively looking for corporate board opportunities. I tap into the thought leadership that the EY Center for Board Matters produces about what’s on the minds of boards and what kinds of risks to think about.
What are you doing for fun in retirement?
I live on an island on a beautiful lake, and after all my traveling, I’m just enjoying being there with my husband, kayaking, and having family and friends visit.
You’ve certainly earned it. The fact that you still want to help others solve problems is inspiring.
EY prepared me well to try to help USAG. It occurred to me that this is an example of people from EY trying to build a better working world. Not that we’ll do it perfectly. We don’t say perfect working world. But we can be part of a solution.
The Women Athletes Business Network: building on the sporting legacy