Governance scandals we all watched — And the lessons we still haven’t learned

The pattern we refuse to break

They always say no one could have known. That the crisis was unforeseeable. That the failure came out of nowhere. But it’s never true.

Someone always sees it coming. A board member ignored. A journalist discredited. A whistleblower quietly shown the door. The signs are there—quiet, inconvenient, easy to minimise. And that’s exactly what happens.

We treat governance like background noise. A formality. A checklist. Until suddenly, it’s not. Until it becomes the only thing standing between stability and scandal, between resilience and reputational ruin.

Across every scandal, the pattern repeats itself; systems designed to prevent failure are too weak, too slow, or too compromised to act. Oversight falters. Conflicts are managed with crossed fingers. Integrity gives way to expediency. Then, once the damage is done, we wheel out reform. We hold inquiries. There are statements, resignations, sometimes even apologies. And then we hit replay.

Because the incentives haven’t changed. We still reward short-term gain and outsource long-term responsibility.

We forget that governance isn’t paperwork; it’s protection. It’s the questions asked in time. The brakes applied early. It is the invisible architecture that holds the visible world together.

Until we start seeing governance not as box-ticking, but as the backbone of sustainable leadership, these scandals won’t be the exception; they’ll just be the next headline in line.

So let’s stop being shocked. Let’s stop calling these moments “unprecedented.” The truth is, we’ve seen it all before.

And still—we’ve learned far too little.

The danger of believing your own hype

Wirecard’s collapse wasn’t simply about missing money; it was about mass suspension of disbelief. A €24 billion company, hailed as the crown jewel of Germany’s tech scene, listed alongside Siemens and BMW, fell not just because of what it did—but because of what others refused to see.

Politicians praised it. Investors piled in. Regulators deferred. And all the while, concerns simmered beneath the surface. The Financial Times began publishing investigations as early as 2015, flagging accounting irregularities and dubious transactions in Asia (FT Investigation Archive). Whistleblowers inside the company raised the alarm—only to face legal threats. In a move that reads like satire, Germany’s financial regulator, BaFin, responded by filing a criminal complaint… against the journalists (BaFin’s complaint coverage – DW).

The governance structure was more theatre than oversight. Markus Braun, the CEO, held tight operational control alongside strategic leadership, while the board stayed largely ornamental. EY, the auditor of over a decade, signed off the accounts—even when cash couldn’t be confirmed in supposed third-party accounts in the Philippines (Reuters coverage).

This wasn’t just a breakdown in controls. It was a masterclass in belief outpacing evidence.

What to look for when hype replaces Governance

The problem with momentum is that it can muffle dissent. Booms bring a kind of boardroom bravado. When share prices soar and press releases sing, asking tough questions suddenly feels inconvenient. But hype, left unchecked, becomes a hiding place for risk.

Here are the red flags that should never be ignored:

Aggressive Culture Toward Scrutiny If a company meets criticism with lawsuits instead of answers—if it treats journalists, short sellers, or whistleblowers as threats rather than feedback—it’s not managing risk; it’s burying it.
Lack of Board Independence When CEOs double as Chairs, and loyalty trumps logic, the boardroom becomes an echo chamber. Without genuinely independent voices at the table, groupthink goes unchallenged, and risk becomes collective denial.
Complacent Auditors An auditor’s job isn’t to be agreeable. If red flags are repeatedly missed, especially in complex or opaque jurisdictions, it’s not just an oversight—it’s a blind spot made permanent. (EY and Wirecard – BBC)
Regulators in the Stands, Not on the Field When watchdogs act more like fan clubs—cheering innovation, deferring to executives, or downplaying concerns—we lose the tension that keeps governance strong.
Narratives Too Good to Question If no one can clearly explain the business model, but everyone agrees it’s “visionary,” pause. When storytelling replaces substance, it’s time to follow the money—and the governance.

The lesson? Success must be interrogated, not idolised. Booms aren’t the time to relax scrutiny—they’re the moment boards must lean in harder. Because when the tide goes out, as Warren Buffett famously put it, that’s when we discover who’s been swimming without a strategy… or a stitch of oversight.

Innovation without Infrastructure

FTX wasn’t a financial platform—it was a personality cult with a crypto wallet. Sam Bankman-Fried’s media charm, altruistic narratives, and unkempt hair masked a hollow core. Behind the scenes, there were no functioning risk committees, no meaningful board oversight, and barely a ledger in sight (New York Times – FTX Collapse).

Customer funds were funnelled into Alameda Research without challenge. Even top-tier investors like Sequoia Capital skipped due diligence—one pitch reportedly happened while SBF played League of Legends (Forbes on Sequoia’s Investment Memo).

SVB, meanwhile, was a traditional bank with a very modern weakness: a start-up echo chamber. With 90% of deposits uninsured and concentrated in the tech sector, it was ripe for digital-era panic. When its bond portfolio cracked under rate hikes, withdrawals snowballed. With no Chief Risk Officer for nearly a year, SVB was effectively flying blind (Bloomberg – SVB Risk Oversight).

At OpenAI, the collapse was reputational. The board removed CEO Sam Altman with minimal explanation, prompting a staff mutiny and exposing the fragility of its governance setup—one that placed a non-profit board over a commercial juggernaut (The Verge – OpenAI Board Fallout).

Warning signs when Innovation outpaces Control

Charismatic Founders with Unchecked Power When one voice dominates strategy, culture, and capital, oversight gets drowned out. No founder—however visionary—should be beyond question.
Missing Oversight Infrastructure Start-ups often delay establishing audit or compliance teams. But without these guardrails, risks scale faster than revenue.
Complex Structures, No Clear Answers Dual-entity setups, shadow subsidiaries, or unclear equity arrangements may mask poor governance. If no one understands the structure, it isn’t serving accountability.
Boards Without Technical Literacy In AI, crypto, or biotech, boards need more than financial literacy; they need domain fluency. Otherwise, risk becomes invisible—and unchallenged.

The takeaway? Governance doesn’t slow innovation. It gives it a seatbelt.

The Cost of cutting corners

The Boeing 737 MAX tragedies weren’t isolated technical glitches. They were the end result of design shortcuts and governance compromises. In a rush to rival Airbus, Boeing added the MCAS system—but failed to train pilots on how it worked. Even certification was handled internally under a diluted FAA framework (NPR – Boeing Oversight).

Internal emails mocked safety processes. “This airplane is designed by clowns…” one employee wrote. The culture had shifted; engineering excellence gave way to shareholder obsession.

Credit Suisse was slower—but just as steady—in its descent. Archegos, Greensill, data leaks, espionage: the scandals stacked up. Reforms were surface-level; culture remained untouched. In 2023, the 167-year-old bank was quietly absorbed by UBS (Reuters – Credit Suisse Timeline).

How to spot when corners are being cut

Regulatory Workarounds Disguised as Agility Skipping controls to meet deadlines may win praise in the short term—but they build structural cracks.
Toxic Tone in Internal Channels Slack jokes may seem harmless, but language reveals culture. And culture sets the tone for risk.
Recycling Leadership After Scandals Replacing figureheads without addressing systemic behaviours is window dressing.
Boards That Observe, Not Intervene Boards must challenge—not just witness. A silent board is not a safe board.

The lesson is clear: speed isn’t dangerous on its own; it becomes dangerous when it outpaces safety.

The Road Ahead

These scandals weren’t unforeseeable. They were ignored.

Again and again, someone saw the warning signs. Again and again, no one acted. Governance was too polite, too passive, or too compromised to pull the brake.

We call them outliers. But they’re not. They’re patterns.

Too much trust in leadership. Too little challenge. Too many pay-outs for silence.

Until we treat governance not as admin, but as architecture—not as a checklist, but as conscience—these scandals won’t end.

Because governance, at its best, is the system that saves us from ourselves.