Corporate transparency: The openness revolution

HOWARD SCHULTZ, the head of Starbucks, said last year that “the currency of leadership is transparency.” If so, bosses should be feeling ever more qualified to command their troops. Business is being forced to open up in a host of reporting areas, from tax and government contracts to anti-corruption and sustainability programmes. Campaigners are cock-a-hoop, but continue to demand more. Executives are starting to ask whether the revolution is in danger of going too far.Three forces are driving change. First, governments are demanding greater corporate accountability in the wake of the global financial crisis. No longer is ending corporate secrecy—the sharp end of which is money-laundering shell companies—an agenda pushed merely by Norway and a few others; it has become a priority for the G20. Second, investigative journalists have piled in. A recent example is the exposure by the International Consortium of Investigative Journalists of sweetheart tax deals for multinationals in Luxembourg. The third factor is the growing sophistication of NGOs in this sphere, such as Transparency International (TI) and Global Witness. “Twenty years ago our work seemed an…

Link to article: www.economist.com/news/business/21636070-multinationals-are-forced-reveal-more-about-themselves-where-should-limits?fsrc=rss%7Cbus

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