Andersen Partners Explore Leadership Options

The meeting -- which patches in partners around the country -- comes at a critical time for Andersen as it fights a felony charge and seeks to sell off large parts of its once-pristine empire.

Chicago-based Andersen, which employs 85,000 people worldwide, is reeling as a result of its role in the Enron scandal. The latest casualty was the firm's CEO Joseph Berardino, who resigned on Tuesday.

"I think the management is in the dark," an Andersen partner in New York said on Wednesday. "Given that the CEO just left us without a worldwide leader, they're scurrying to put together their plans and make sure they're all on the same page..."

The closed-circuit meeting, led by recently installed head of U.S. operations Larry Gorrell, was set to run from 10 a.m. until 3 p.m. EST, according to an Andersen memo.

In London on Thursday, members of the firm held talks on a successor for Berardino and on salvaging a merger with rival KPMG, even as it prepared to axe jobs in the United States.

Sources close to Andersen tipped Aldo Cardoso, chairman of Andersen Worldwide and head of Andersen's French operations, as the frontrunner to replace Berardino.

Andersen partners are looking for answers. Many of them have hundreds of thousands of dollars of their personal net worth tied up in the firm's future. That money will almost certainly be swallowed in the coming months, as billion dollar lawsuits from angry Enron investors loom large and Andersen seeks to settle its legal liabilities.

"Certainly the feeling around here is that we want to know everything," said the partner in New York. "And we want to have the right to vote on it because it's our money that is pretty much gone. But if there is any to be recaptured we would like to know what the hell they're doing."

Agreements that make it difficult for partners to leave the firm and work at rivals are also likely to be discussed, the partner said. Waiving these non-compete clauses from the partners' contracts is seen as a move that would help partners but also encourage defections.

Another closed-circuit meeting is set for Tuesday, when a board meeting of umbrella organization Andersen Worldwide will take place in London.

On the merger front, Andersen has been pushing for deals across the globe in a bid to salvage some of its international businesses. Talks are continuing between Andersen and KPMG on a merger of partnerships in various countries, although some have done deals with rival firms, including Russia, Australia, New Zealand, Hong Kong and China.

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