About the company information confidential and transparent

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    a7330008
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    What factors shoud be involved when the quesiotion related “the company information confidential and transparent”?


    Avatar of MikeLittle
    MikeLittle
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    Would you like to re-post your question, but this time can you write it in such a way that I can understand it?

    Many thanks


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    a7330008
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    Oh, yeah, I am sorry.
    There is some commerical reason that companies’ information shoud be ket
    confidential. However, the transparency tell us that the company should disclose
    information to shareholders. How to balance this condition? what if some information should be disclosed but the director said they are internal confidential information ? Thank you very much!


    Avatar of MikeLittle
    MikeLittle
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    That’s better! Now, to your question! Company directors are clearly accountable to their shareholders and, in a wider context, to all other stakeholders. They satisfy this accountability by the publication of financial statements together with management reports, business reviews, institutional investor meetings, website announcements ….

    All of this is moving towards greater and greater transparency. However, there are some matters where it would be inappropriate to make publication from “day1″. For example, where a board of directors makes a strategic decision to acquire the business of a competitor, or to enter a price war, or to make public their plans with reference to product development and innovation … in any of those situations premature disclosure would be inappropriate.

    I suppose we can generalise the solution! If it has already happened, then full disclosure is appropriate. If it’s still in the planning stage, then disclosure is not appropriate. And so we can probably safely say “With reference to disclosure, it’s all or nothing”

    Does that help?


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    a7330008
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    Yes, thank you very much!
    However, if one case says: the director refuses to disclose some information and
    the reason is that they are confidential information. How can I judge they are really
    confidential or not? Does only see whether it is planning stage?


    Avatar of MikeLittle
    MikeLittle
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    Not really. Any board of directors can “refuse” to disclose ANY information beyond what is required by law or IFRS. However, in the best interests of modern corporate governance guidance, transparency is ( hopefully ) becoming the norm. Cadbury, in his committee’s report, identifies transparency and accountability, honesty and probity as fundamental to the concept of corporate governance. But these are identified “ideals” and, as yet, not legal nor professional requirements.

    Hope that helps

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