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An Interview with Don Tapscott and David Ticoll 
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According to The Naked Corporation, transparency, driven by technology, globalization, and crises in trust, is changing the face of business. Scroll down to learn more about this growing phenomenon and how it will shape the 21st century.
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Q: How did you get turned on to the idea of transparency?
A: (Don) David and I have been investigating the impact of information technologies and new media on business and society since the early 1980s. Throughout the 90s, transparency kept occurring more and more as a tantalizing theme, but no one had even investigated
it. Amazingly, when we began work on The Naked Corporation we found that there were virtually no books, articles, or research about transparency as a force in business and the economy. Most people viewed it narrowly as financial disclosure. Now it seems that every day there is a headline where some person or company didn't understand the power of transparency as a new force. The recent resignation of Richard Grasso from
the New York Stock Exchange is emblematic—he and the board didn't understand that in the age of transparency you're going to be naked and if you're naked, you'd better be buff.
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(David) I was also doing a lot of consulting and speaking in Asia and Latin
America in 2000 and 2001. I realized, and began to advocate, that businesses and economies in these areas need to eliminate corruption and self-dealing if they are to compete effectively in the global economy. Global supply chains—what we call business webs—depend on value, low transaction costs, and the disciplines of the marketplace. This is essentially an issue of transparency and trust. I then began to realize that transparency is a multi-way phenomenon that also applies to businesses in wealthy countries. I suppose we can say we came to this theme honestly—before the Enron fiasco and the crisis of trust. |
Q: You argue that, after a crisis in trust, we need to rethink corporate responsibility and move towards “the open enterprise.” Can you give us an example of a company that embraces this new perspective and describe how it is benefiting from doing so?
A: (David) Chiquita is a great example. Chiquita was once reviled for its activities in Latin America. It fomented political coups, bribed politicians, pillaged the environment, and brutalized employees. In 1998 it adopted
a policy of corporate responsibility, which calls for honest and open communication about its problems and treating all people with dignity and respect. The policy came too late to save the company from bankruptcy in November 2001, but Chiquita executives say it was instrumental in helping the banana giant repair relations with workers, suppliers, local communities, and environmental activists—and emerge in better shape four months later. Now the company's share price is on the upswing; the business is refocusing and growing. Meanwhile, it is winning awards for corporate citizenship and starting to use this to strengthen its marketing message. |
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Q: The Internet has greatly contributed to a culture of transparency. How do you see the entry of the Net Generation into the workforce impacting corporate transparency?
A: (Don) This is the first generation to come of age in the digital age. They have unprecedented access to information, and the evidence is strong that they are more knowledgeable than any previous generation. Moreover, there is so much false or misleading information in the digital world that they've had to develop good authentication techniques at an early age. As this generation enters the workforce and marketplace in developed countries, they will be a powerful force for transparency. The evidence is strong that they will scrutinize firms and other institutions like never before. They will demand choice, authenticity, and value. Once they find out something important, they have at their fingertips the most powerful tool ever for informing and organizing others.
Q: Where is government in the issue of transparency? As corporations and customers become increasingly powerful, how does the role of government change?
A: (Don) Transparency is a force affecting every institution in society, including government. Like corporations, governments are coming under increasing pressure to be honest, accountable and open. We'll see new forms of democracy emerging as citizens demand to be better informed and engaged in important decisions that affect their lives. For a tiny taste of this consider the anti-war protests prior to the Iraq war. Regardless of what you think of the war, everyone agrees that these protests were larger than the demonstrations at the height of the anti-Vietnam war movement. They were organized virtually overnight, too. People have at their fingertips the most powerful tool ever for, as we say in the book, "finding out, informing others, and organizing."
Q: The Cold War was one of the factors that contributed to secrecy in the past. Will today’s issues of national security and terrorism have the same impact? Why or why not?
A: (David) Yes and no. On the one hand, governments—particularly the U.S. government—are passing laws that protect and extend corporate secrecy. In some cases you could argue that this legislation is actually counter to the interests of national security. For example, under the Homeland Security Act, companies can disclose information to the U.S. federal government that is supposedly pertinent to national security. Then, the information becomes secret. The problem is that this provision protects the secrecy of information—such as the release of pollution into a river—that may have no bearing on national security. You could even argue that national security would be better served if such information was made public. Also, of course, there has been a chill in the media and in public support for diverse points of view. On the other hand, there is a lot of evidence that transparency continues to shine. The recent exposé and resignation of Richard Grasso at the New York Stock Exchange is a good example. Also, the debate about Iraq and the Middle East is broadening and becoming increasingly fact based. This is happening because effective solutions depend on trustworthy information and behaviour.
Q: What are you working on now?
A: (David) I am doing a weekly column at The Globe and Mail, which keeps me pretty busy! More broadly, we are forming a new company that will assist organizations in implementing competitive strategies for the new, trust-focused business environment.
(Don) In addition to building the new company, I'll be doing a lot of writing, mainly for U.S. and U.K. publications. I'll also be presenting these ideas to executive audiences internationally.
Learn how to manage transparency in the networked economy at Digital4Sight.
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