This is a partial transcript from Your World with Neil Cavuto, February 8, 2002. Click here for complete access to all of Neil Cavuto's CEO interviews.
NEIL CAVUTO, HOST: Another stock under pressure lately, Cisco Systems. As if cautious comments about this year were not enough, now some investors are dragging out the Enron paintbrush, saying if it is too complicated to understand, it is simply too easy to sell.
I spoke with Cisco CEO John Chambers yesterday and got his take on the Enron mess.
(BEGIN VIDEOTAPE)
JOHN CHAMBERS, CEO, CISCO SYSTEMS: This might be a little bit of a surprise to you, but I believe you can trust most Americans. I believe you can trust most CEOs. I believe you can trust most people in the media. When people violate that trust, they should be held accountable. I think it's typical fashion when things occur, people overreact to an extreme, and I think you will see that pendulum come back down to the middle. I believe most people are honest and I think we will realize that over time.
CAVUTO: Clearly, there is concern about even businesses that might be very honest, but businesses are hard to understand. And it is affecting good and bad companies alike. I mean, for a while, you were caught up in that downdraft, people didn't even appreciate or understand the magnitude of your business.
It got companies like PNC Financial and GE and Tyco. The jury is out on a couple of those names, but I think it does raise issues about if it is complicated, investors are saying I'm backing off. Does that worry you?
CHAMBERS: Well, I think in the long run, the market always gets it right, though you might see fluctuations in the short run. But we needed to be more effective in sharing with people the numbers in a way that they could make decisions. So we got the focus back on cash profits.
You know, in hindsight, we should have realized that if companies were really profitable, they should be generating a lot of cash. And so when we talk about profits and generating cash per month of 300 to $400 billion from cash from operations, that is obviously a very profitable company. And so over time, the market will absolutely get it right. I think businesses have to have more consistency in the reporting. And I think this is actually a healthy thing, to bring it back into the middle again.
CAVUTO: Let me just get your personal opinion on this. If it's proven that Enron did nothing illegal, but a lot of things unethical, should executives there go to jail?
CHAMBERS: Well, I don't want to comment about another company because without knowing the facts and the detail behind it, that is a tough one. I believe if you look overall, if people violate the law, they should absolutely be held accountable. And that is what our whole system is about. I just...
CAVUTO: What if this isn't about violating the law? What if it all comes down to, John, just so our accounting structure is such that a lot of this stuff is illegal. It doesn't seem kosher, but it's legal and that's it, a lot of unethical behavior. Should you go in the slammer for that?
CHAMBERS: Well, I think there is a very clear issue here and I'm not an expert in this area. I want to talk about what I can control. I think you ought to be held accountable, Neil, and that is the key issue. I think the market will absolutely hold accountable unethical behavior. I think if people violate the law, then they should be held accountable, including going to jail for that.
Until you know the facts, it is very dangerous for people to form opinions on that. So, I go back to the basics. I trust people. I believe that most people are honest. I believe you should fully disclose as much as you can, even if it creates confusion in the short run and then figure out how to get that message out more effectively, and then you hold people who violate that accountable for the results.
(END VIDEOTAPE)
CAVUTO: All right. Cisco Systems CEO John Chambers.
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