In an era when corporate secrets can be unravelled with a few lines clicks of the mouse, it is only a matter of time before the public can discover facts a company wants to keep hidden.
In MT’s debate about the future of corporate governance in association with BSI, our panel of experts say transparency has now become an integral part of doing business.
‘You’ve got to be communicating consistently with your external stakeholders and your employees,’ said Howard Kerr, chief executive of standards firm BSI. ‘There’s no point messaging one point to the market and another to your staff. You have to be consistent in your communication.’
MT editor pointed out that the UK doesn’t fair too badly in the global ranking of transparency: ‘If you look at the latest Transparency International annual report, the UK comes 14th out of 177 countries for straightness in dealing with business. So we do need to remember that. We’re not squeaky clean but we don’t do that badly,’ he said.
But Professor Chizu Nakajima from Cass Business School says there are consequences to being too transparent. ‘If you are obliged to disclose everything first, there’s an issue of whether you’re giving away trade secrets. That could impact negatively on your competitiveness,’ she says. ‘By disclosing, for instance, executive pay it’s actually had a negative effect – it’s what’s led to this endless upward spiral of executive pay.’